Way behind in polls, facing a voter revolt on account of uncontrollable inflation and slowing economy, Erdogan has pinned his hopes on finding foreign donors who will bankroll Central Bank reserves and provide the financing to carry him to yet another election victory. His first stop was Sochi, where he seems to have gotten a gift from Putin. According to Turkish sources, he is now going to Riyadh hat in hand to beg for more.
According to al Arabiyah, Ankara is looking to receive an initial $10bn deposit in Turkish bonds and accounts following rapprochement between Erdogan and Mohammed bin Salman.
On Wednesday, Turkish newspaper Dunya, citing treasury sources, said Saudi Arabia was expected to deposit an initial $10bn into Turkish treasury bonds and accounts.
One Turkish treasury source confirmed to Middle East Eye that technical talks were underway to secure $20bn from Saudi Arabia.
In June, Saudi Crown Prince Mohammed bin Salman visited Ankara, ending a four-year rift with Turkish President Recep Tayyip Erdogan, who escorted him to the airport as he departed.
The visit came after Turkey dropped a court case in which Saudi agents suspected of killing journalist Jamal Khashoggi were being tried.
Khashoggi, a Saudi columnist for Middle East Eye and the Washington Post, was killed by a hit squad in the kingdom’s Istanbul consulate. The CIA concluded Mohammed bin Salman signed off on the operation personally, an accusation he denies.
Turkish Economy Won’t Survive The Winter
A joint declaration by the two governments following the crown prince’s visit underlined an intention to deepen trade, energy, and defense ties, as well as political and regional cooperation and consultation.
Turkish Finance Minister Nureddin Nebati told a group of journalists earlier this month that Turkey would need $30bn to $35bn to finance its current account deficit, which has been bloated due to increasing energy prices. He said Turkey was looking to nearby countries for help, such as Russia and Saudi Arabia.
Why Erdogan Will Never Win Another Election?
It is too early to decide whether Putin and Salman will choose to bail Erdogan out with hard earned cash, but one thing is clear. Foreign funding will not improve economic performance. Cash injections into the economy will boost real income growth, but at the expense of wider current account deficits and raging inflation. This mix is not voter-friendly. However, for potential donors considering extending Erdogan’s shelf-life, there is a bigger question at stake: Will he return the favor? Erdogan has belly-danced between Russia and west, has been flip-flopping on relations with Israel and continues to meddle in Arab affairs via incursions into Syria and under-the-table support for HAMAS and the Moslem Brotherhood.
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