Analytical Brief n.10, February 2021

Economic crisis

Turkey's increasing involvement in regional and global politics takes place against the backdrop of complex domestic problems. The most important is the ongoing economic crisis. Confronting the Covid-19 epidemic, Turkish government was forced to put limits on certain economic activities. State-imposed restrictions affected, above all, small and medium-sized enterprises (SME) that are critical for Turkish economic development. Following the introduction of an economic stimulus package, the government was unable to curb inflation; the national currency slid against the U.S. dollar and the euro. In November 2020 the overall inflation rate exceeded 14% and the level of food inflation rate reached 21%.

As a result, in early November 2020, President Erdogan decided to remedy the situation by sacking the Finance Minister (and the president's son-in-law Berat Albayrak), and the governor of the Central Bank. Already in mid-November the new head of the Central Bank, Naci Ağbal, raised the key interest rate from 10.25% to 15%. In December the interest rates went up to 17%. Following the rate hike, the Turkish lira exchange rate stabilized, but the fact that the rates had to be raised twice points to the seriousness of the Turkish financial situation. It should be noted that President Erdogan has a negative view of the high central bank rates.

Pandemic-driven economic crisis led to a decline in living standards of a significant segment of the Turkish population and contributed to the rise of unemployment, particularly among the young. According to the government estimates, the country’s unemployment rate is about 12-13%; independent analysts believe that the actual number is at least twice as high.

One bright spot for investors in the bad economic news is that in 2020 Turkish exports exceeded $166 billions, which is slightly more than it was planned, but less than 2019 figures ($180 billion). Thus, Turkish exporters have shown quite a good result for such a difficult year for foreign economic relations.

Political struggle

Economic hardships serve as a background to a continuous armed conflict between the Turkish government forces and its opponents, above all the Kurdistan Workers' Party (PKK), but also several left-wing extremist organizations (the Marxist-Leninist Communist Party, the People's Liberation Front Party, etc.), the Islamists of ISIS and other similar groups that may be viewed as a spillover from Syria.

• Salafism

Although social and economic conditions conducive to the development of Salafist groups in Turkey exist, whether political Salafism can find fertile ground in Turkey is a debatable issue. Salafism is a product imported from Saudi Arabia. In public opinion polls Arabs traditionally enjoy high anti-ratings among other Turkish ethnic minorities. The education of Muslim clergy in Turkey is under tight state control. Turkish police, gendarmerie and intelligence services regularly report detaining members of Salafist groups. Last year Turkish court sentenced Abu Hanzala, the leader of IS in Turkey, to twelve and a half years in jail.

Nevertheless, the longstanding Salafist war on Syria has been tacitly supported by Turkey. The Salafists groups operating in Syria had their rear base in Turkey and used Turkish territory as a save haven. In November 2020, a well-known Turkish preacher, Cubbeli Ahmed , accused Salafists in Turkey of preparing an uprising and offered information to Turkish law enforcement agencies. According to Saudi media sources there are over 150 Salafist associations in Turkey, especially in the southeastern provinces of Batman and Adiyaman. Reality on the ground remains more complex, however, as Turkey is weary of the Salafism on one hand, but may be using the Salafist groups to counterbalance the Kurds on the other.

• Fethullah Terrorist Organization" (FETÖ

More than four years after the failed coup attempt against Erdogan, the crackdown on the Gulen movement or the so-called "Fethullah Terrorist Organization" (FETÖ), as it is officially known in Turkey, remains the focus of public attention in Turkey.

Every week brings news of arrests among active and retired military officers, teachers, and journalists, lawyers and government officials. Since July 15, 2016, more than 283.000 people have been detained on suspicion of involvement in the FETO conspiracy, and over 100.000 have been arrested.

The Turkish Foreign Ministry has not abandoned its attempts to convince the leaders of the countries where the Gülenist schools are still operating to close them or to transfer them to the Turkish educational foundation Maarif. This has been done in 19 countries, including Afghanistan, Pakistan, Tunisia, Chad and Venezuela. Before the attempted military coup in 2015, Gulen schools operated in 115 countries worldwide. In some countries, including Russia, Uzbekistan, and Turkmenistan, they were closed as early as the mid-2000s. In the United States, for example, more than 200 FETÖ schools are currently operating, in Iraq - more than 40. Gulen schools continue to operate in countries like Kyrgyzstan and Kazakhstan, where they cater to the children of the local elite.

• Coming 2023 legislative elections

General elections in Turkey are scheduled to be held in 2023. Voters will elect a new president, as well as 600 members of the Grand National Assembly of Turkey, each for a term of five years.

Economic and social problems have affected the popularity of the ruling Justice and Development Party (Adalet ve Kalkınma Partisi) and its coalition ally, the Nationalist Action Party (Milliyetçi Hareket Partisi). Some opposition figures keep insisting that early elections are inevitable in 2021 amid the sharp decline in the living standards. At the same time, Erdogan's main electoral base - the conservative voters of central Anatolia and the Black Sea coast or the so-called "Anatolian tigers", (in opposition to the wealthy groups of the Aegean and Marmara coasts) remain loyal to the President. According to recent opinion polls, the AKP is currently capable of gaining no more than 30-35% of the votes. The rating of the Unionist PND is in the range of 8 to 11%. Thus, the ruling coalition, as of early 2021, is not capable of gaining the desired 50%+1 vote.

The parliamentary opposition, represented by the People's Republican Party (Cumhuriyet Halk Partisi) and the Good Party (İYİ Parti), despite gaining support, remain divided and caught in the web of pervasive intra-party conflicts. The PPP's rating remains in the range of 25%, although recently it has slightly increased. The Good Party demonstrated an increase in popularity during the pandemic crisis, gaining more than 10% of potential votes. Despite all the persecutions and arrests, the rating of the Democratic Party of the People (Halklar Demokratik Partisi) remains at about 15%. Thus, as in the last elections, the Democratic Party of the People may still become a leading political force in the parliamentary opposition coalition, while a significant number of its MPs, including the party chairman Selahattin Demirtaş, as well as city mayors and municipal deputies, are currently jailed on charges of participation in the armed terrorist group - the Kurdistan Workers' Party (PKK).

New parties founded by former Erdoğan associates Ahmet Davutoğlu (Future Party, Gelecek Partisi) and Ali Babacan (Demokrasi ve Atılım Partisi) have not yet gained the popularity that would allow them to qualify for seats in the future parliament.

The same can be said about the conservative parties, acting as an alternative to the AKP on the right and claiming the legacy of the father of modern Turkish conservatism Necmettin Erbakan - the Party of Happiness (Saadet Partisi), the New Welfare Party (Yeniden Refah Partisi).

The leftist parties, such as the Fatherland Party (Vatan Partisi, the former Workers' Party) and the Communist Party of Turkey, which recently won the election of the first Communist mayor in Turkish history in Tunceli Province are polling at around 1% of the votes.

• Coming 2023 presidential elections

One of the key challenges in the coming 2023 presedential elections is finding a strong leader who could seriously compete with Erdoğan in the presidential elections. The young and ambitious mayor of Istanbul, Ekrem İmamoğlu, could take on this role, if he survives the ordeal of leading the city through the COVID-19 pandemic. Ekrem Imamoğlu, a representative of the PPR, won the 2019 mayoral elections twice over AKP representative, former Turkish Prime Minister Binali Yildirim. The loss of Istanbul city hall was particularly painful for the ruling party, which simultaneously lost several other important municipalities, including Ankara. Erdogan was a mayor of Istanbul (1994-1998) and considered it as its stronghold. Ekrem Imamoglu, like Erdoğan, comes from the Black Sea coast (born in Trabzon). Representatives of the "Black Sea network" are numerous at the highest levels of government in Turkey. It is noteworthy that Imamoglu, despite being a representative of a secular social-democratic party, positions himself as a person of religious and conservative views.

The mayor of Ancara, Mansur Yavaş of the AKP is another potential presidential contender. Mansur Yavas is a native of Central Anatolia (former mayor of Beypazar) who previously represented the nationalist PND. But today, even the secular, Kemalist opposition in Turkey is forced to bet on leaders whose image is associated with conservatism and nationalism.

The role of Kemalist ideology and the armed forces that upheld it in Turkish politics has declined radically since 2016. The investigation into the attempted military coup is ongoing, and there are regular arrests of active and retired officers accused of participation in the FETO. The Kemalist influence still seems to have some significance for the Turkish officer corps as a whole, but its role has diminished considerably. Erdoğan has the image of a determined politician who is not afraid to intervene in Syria, Iraq, Libya and Azerbaijan to advance Turkish interests. As such he is popular with a large part of today's Turkish officer corps.

Copyright ICSE, 2021