Reuters:  Turkish opposition alliance plans to put Babacan in charge of economy

Turkey’s main opposition alliance plans to make former deputy prime minister Ali Babacan a vice president responsible for the economy if it wins a presidential election set for May 14, four senior sources in the alliance told Reuters on Friday.  Famous Turkish columnist Fatih Altayli of claimed the counter-move by Erdogan is to persuade former economy czar and investment banker Mehmet Simsek to return to his position.


The Reuters article claimed the six-party alliance had also identified a candidate to be appointed as governor of the Turkish central bank, but did not say who it was.


“In a system that Babacan will manage, there will be a structure where important ministries will be undertaken by other parties,” a high-level official in the alliance said.


The official said the treasury and finance ministry, currently one institution, could be split into two.

Babacan was formerly a close ally of President Tayyip Erdogan, but quit his ruling AK Party in 2019 over differences about its direction and formed the Deva (Remedy) Party. He was also in charge of the economy under Erdogan and was well regarded by foreign investors at the time.


The Deva Party declined comment on Babacan’s future role. Another source familiar with the situation said Babacan would also oversee foreign investment and the overall investment climate.


Ali Babacan and his former boss, Gelecek Party leader Ahmet Davutoglu  had played an important role in convincing IYIP leader Meral Aksener to return to the Nation Alliance fold, which subsequently agreed on CHP leader Kemal Kilicdaroglu as its presidential nominee. Their good offices may have increased their coin the coalition, though it is very likely that CHP and IYIP economy teams will vie to grab key positions from Babacan.


Kemal Kilicdaroglu, head of the main opposition CHP, emerged on Monday as the alliance’s presidential candidate to challenge Erdogan in the elections.


Polls suggest that the presidential and parliamentary votes in May will be tight, with the opposition bloc running slightly ahead of the governing alliance.


Regarding the central bank appointment, a CHP official said, “There is a candidate who knows central banking and will take over and start working immediately, and he is ready.”


“There will be an independent central bank,” the official said. “There will be no political interventions. In terms of economic management, Deva Party and Babacan seem very ready.”


The sources said the alliance had agree that it would focus on repairing damage which they said had been done to institutions and that “non-market” practices will be ended.


These practices include central bank exchange rate controls, unorthodox monetary policy, loan restrictions and any market unfriendly policies.


Returning to Republican Alliance, columnist and TV personality Fatih Altayli claimed former economy czar Mehmet Simsek, currently retired from active politics, has been persuaded to take up the same position. According to Altayli, he may be appointed even before the election to increase confidence in the business community and among global creditors that Erdogan will embrace orthodox economic policies if he is reelected.


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Published By: Atilla Yeşilada

GlobalSource Partners’ Turkey Country Analyst Atilla Yesilada is the country’s leading political analyst and commentator. He is known throughout the finance and political science world for his thorough and outspoken coverage of Turkey’s political and financial developments. In addition to his extensive writing schedule, he is often called upon to provide his political expertise on major radio and television channels. Based in Istanbul, Atilla is co-founder of the information platform Istanbul Analytics and is one of GlobalSource’s local partners in Turkey. In addition to his consulting work and speaking engagements throughout the US, Europe and the Middle East, he writes regular columns for Turkey’s leading financial websites VATAN and and has contributed to the financial daily Referans and the liberal daily Radikal.