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Erdoy-an may hand management of economy over to family member.

ySTANBUL (CyHAN)- While questions still hang over who would be in any new economic management team influenced by President Recep Tayyip Erdoy-an, it is being argued that Erdoy-an would replace competent technocrats by less experienced figures, some of them from among his family members.

Deciding who would assume the key positions covering the economy remains a major topic of debate backstage in Ankara. Rumor has it Erdoy-an would push for the appointment of such close relatives as his son-in-law Berat Albayrak to a position in the economy management.

Such a possibility is far from allaying foreign investor concerns over Ankara's new economic management team after the general election in June, experts argued on Thursday.

Erdoy-an's harsh rhetoric recently raised concern about the futures of Central Bank Governor Erdem BaE-cy and Deputy Prime Minister Ali Babacan, who is in charge of the economy and has been a staunch defender of central bank independence.

The concerns rose particularly after Erdoy-an named Yiy-it Bulut his chief economic adviser last year. Bulut, a former TV commentator, is best known in Turkey for suggesting Erdoy-an's enemies were seeking to kill him by telekinesis, or psychic power.

Albayrak, who was listed as a deputy candidate on the Justice and Development Party (AK Party) ticket for the upcoming general election, will be assigned as the government's new economy chief, according to rumors in Ankara.

It is claimed that, if elected, Albayrak will reportedly be responsible for the economic affairs under another possible AK Party term.

Criticizing monetary policies and the recent stance of the central bank in its debate with Erdoy-an, Albayrak wrote in his column in the Sabah daily on Sept. 1, 2014: "What should one tell those who hold office at such an important state institution without taking initiative in any subject and without expressing an opinion? What is expected from this institution is not to act like it was a branch of other powers or groups and to focus on the country's own benefits as an institution of the 'New Turkey'."

Albayrak was the CEO of pro-government Ecalyk Holding when Powertrans, a company that was established under Ecalyk Holding, was allegedly given the tender to take part in the controversial transportation of oil drilled in northern Iraq. Albayrak was also among the suspects of a major graft and bribery investigations that was made public on Dec. 25, 2013.

Meanwhile, former Ministry of Finance Undersecretary Naci Ay-bal and former Borsa ystanbul (BIST) head ybrahim Turhan are claimed to be among the new economy team of the AK Party after the election.

"Not sure the family connection would assure investors," Timothy Ash, head of emerging markets for Standard Bank in London, told Today's Zaman on Thursday, adding, "Turhan is well respected from his time at the central bank and the BIST."

In an earlier report, Ash had told Reuters: "If Babacan or BaE-cy are forced out by the Erdoy-an loyalists, I think the market reaction would be severe and brutal," predicting agencies Fitch and Moody's would consider ditching Turkey's investment grade credit rating.

Meanwhile, rival agency Standard and Poor's (S&P) will update its rating on Turkey on Friday.

Uncertainty rules in AK Party

The ruling AK Party failed to list the names for their economy team in the case they maintain the government role after the election, while key opponents have already shared their economy team and even long-term economic plans.

A three-term limit for AK Party deputies meant there was a question mark over Deputy Prime Minister Babacan's return, although there are ways around this, such as his reappointment as a minister without being a member of Parliament.

Babacan, in charge of the economy and an anchor of investor confidence, looks increasingly unlikely to return after the June general election. Prime Minister Ahmet Davutoy-lu indicated on Thursday that Babacan would not be a minister following the election but that he could play a role in economic management from outside the Cabinet.

"I have the utmost respect for Ali Bey. ... Whether Ali Bey is a minister or not, there is a single economic management team that he could contribute to." Babacan is unable to stand in the June election because of an AK Party regulation that limits members to three consecutive terms in Parliament.

"It is not beyond the realms of possibility for there to be ministers from outside [Parliament]," Davutoy-lu said, adding, "But it is necessary to open the way for colleagues newly entering politics." His statements only add more to the current uncertainty.

Even if their departure is not immediate, the likelihood of Turkey's current economic management team remaining in place after the parliamentary election appears to be diminishing.

BaE-cy's term ends in 2016 and his reappointment, a decision made by the prime minister and his deputy but ultimately approved by the president, looks unlikely, experts argue.

E[currency]imE-ek could stay

Candidate lists for Turkey's June 7 parliamentary election point to Finance Minister Mehmet E[currency]imE-ek retaining a central role in managing the economy, officials told Reuters, in a move that will likely reassure international investors.

Alongside Babacan, E[currency]imE-ek is seen as a counterweight to President Erdoy-an and his close advisers, whose repeated attacks on the central bank for failing to slash interest rates have alarmed markets and sent the lira plummeting to record lows.

The list for the AK Party, which is expected to win the vote, features close allies of Erdoy-an, bolstering his chances of cementing support for stronger presidential powers in the new Parliament.

"Babacan and E[currency]imE-ek are credible names both in domestic and international markets. If Babacan is not in the Cabinet, then his support from outside would be a big [positive] indicator for markets," one official said. Another official said E[currency]imE-ek would likely retain his role as finance minister.

Davutoy-lu's economic adviser Emine Nur GE-nay, Deputy Prime Minister Numan KurtulmuE- and Economy Minister Nihat Zeybekci, an outspoken Erdoy-an loyalist, are also strong candidates for the new Cabinet.

In total, fewer than half of the AK Party's current 312 deputies are on the list, meaning the party that has dominated Turkish politics for almost a decade-and-a-half will see sweeping changes after the June vote. (Cihan/Today's Zaman)

Emre Soncan in Ankara contributed to this report.


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Publication:Cihan News Agency (CNA)
Date:Apr 10, 2015
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