Jun 29 2018

Turkish ministerial appointments superfluous – Erdoğan adviser

Speculation about who Turkish President Recep Tayyip Erdoğan will appoint to ministerial positions for the economy are wrongly based on the assumption that the old system in Turkey will continue under a strengthened presidency, said Cemil Ertem, economic adviser to Erdoğan.

“It is inexplicable that who will be the economy ministers is being so intensely debated, for ministries in the new period are the cover, not the book,” Ertem said. “As the famous adage says, "do not judge a book by its cover," for what makes the cover precious is the book. Here, the book is the democratic choice of the nation, that is to say, the democratic executive authority the president has received from the nation.”

Investors are seeking more information on Erdogan’s economic plans after growth-inducing policies had led to a slide in the value of the lira against major currencies ahead of elections last Sunday, in which Erdogan gained increased executive powers in a new five-year term of office. Appointing market-friendly figures to key positions will be important to retaining confidence in Turkey, investors and economists say.

Ministers who previously enjoyed bureacratic power as elected MPs will now act directly in line with the political objectives of Erdoğan, as appointeed bureaucrats, Ertem said. Erdoğan will also set up committees to devise policy and ministers will then take their orders from the president, he said.

“I think that the figures in the new administration structure to be determined in the upcoming days might be a matter of magazine curiosity rather than of politics,” Ertem said.

Ertem said Turkey would continue to stimulate economic growth through measures such as a credit guarantee fund and a new ratings system for small and medium-sized enterprises to enable them to borrow more easily.

“In this sense, the road map is clear; investments will not stop, and the wheels of the economy will continue to turn by essentially handling structural problems such as inflation and the current account deficit in an inclusive growth perspective,” he said.

The Turkish economy is likely to grow by an annual 5-6 percent in the second quarter following an expansion of 7.4 percent in the first three months, Ertem said.

As for the foreign currency debts of corporations – cited as a key economic weakness by analysts and investors – Ertem said the situation was under control and “there is not a level of indebtedness that cannot be converted or a considerable open position.”