Turkey heading for more turmoil

Current Turkish election results spells troubles ahead for Turkey’s stability. We expect that in  Tukisch political climate of polarization current elections result will lead to political and economical instability. As Turkey host many extremist, the country is the supply route for Jihadist in Syria and Iraq, Turkey face a serious risk violence will be spilled over into Turkey. Many European annalist and politicians do underestimate the polarization of Turkish society and its economical instability.

USDLira

Lira versus the dollar since 2012

Under Erdoğan Turkey was moving to a more restrictive regime that curbs some liberties. Under the AKP there has been a ban on Twitter and YouTube. Journalist came under heavy pressure.

Turkey’s Elite is extremely polarized. At the countries border two cruel wars are fought. Turkeys suffer an enormous pressure from foreign refugees. Jihadist using Turkey as save basis to fight Assad. There has been mass arrest and convictions of military officers. There is a serious conflict between the MIT (Millî İstihbarat Teşkilatı Turkey’s secret service) and the army. There has been a crack down on the juridical system by the AKP.

Turkey’s economical growth is partly based on debt based consuming and an endless trade deficit. Foreign investment in Turkey fell by more than one-third in March year-on-year in the first quarter of 2015 and the current political situation will make investors much more concerned. We expect the the lira will plummet further against major currencies as the Euro and Dollar.

CurrentAccountTurkey

Turkey recorded a Current Account deficit of 5 USD Billion in March of 2015.

Even the AKP party did lose a majority it still held 47% of the seats. We do not think Turkey will find a coalition and reelections are highly probably. The current election result will temper the AKP party grip on power and are seen by many observers as an victory for democracy. We expect that the victory for the democracy will not last long. We expect that in  current Tukisch political climate of polarization, the current elections result will lead to extreme political and economical instability. As Turkey host many extremist, the country is the supply route for Jihadist in Syria and Iraq, Turkey face even a serious risk violence will be spilled over into Turkey.

More sources

Foreign investment in Turkey falls by more than one-third (hurriyetdailynews May 24 2015)

Turkey blocks access to social media and YouTube over hostage photos (The Telegraph April 6 2015)

Erdogan vs Army: ‘15% of Turkish top brass on trial, hundreds resign’  (Russian Today Feb 19 2013)

Turkey’s top judicial body suspends prosecutors over probe into inner circle of president Tayyip Erdogan (ABC December 2014)

 

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