Erdogan Claims Victory in Local Turkish Election, Promises Stability

Photographer: Kayhan Ozer/Turkish Prime Minister's Press Office via AP Photo

The nation’s financial markets have plunged since news of corruption investigations emerged in December, though they rallied in the week leading up to the balloting. Close

The nation’s financial markets have plunged since news of corruption investigations... Read More

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Photographer: Kayhan Ozer/Turkish Prime Minister's Press Office via AP Photo

The nation’s financial markets have plunged since news of corruption investigations emerged in December, though they rallied in the week leading up to the balloting.

Turkey’s Prime Minister Recep Tayyip Erdogan, fresh off a win in local elections, warned his enemies that he’s got a mandate to root out “traitors” from within after months of graft leaks shook his administration.

Erdogan’s Justice and Development Party, or AKP, won 46 percent of the vote yesterday, according to unofficial results reported by NTV television with 99 percent of ballot boxes counted. Against the backdrop of the corruption probe, his party polled stronger than it did in the 2009 municipal vote, when it won 39 percent.

Even amid the worst crisis of Erdogan’s rule, the opposition made few inroads into the dominance of his party, which has won every election since it came to power in 2002. The premier campaigned on his successes in improving the economy, health care and transport, saying that record was more important to Turks than corruption charges concocted by political enemies.

Yesterday’s vote took place after a deluge of recordings, some purportedly from police wiretaps, flooded the Internet and called into question everything from the financial probity of Erdogan’s ministers and family and their religious piety to the integrity of Turkey’s foreign policy and the independence of its media. Erdogan blames the leaks on supporters of the U.S.-based Islamist cleric Fethullah Gulen in the judiciary and police.

Photographer: Adem Altan/AFP via Getty Images

Turkish Prime Minister Recep Tayyip Erdogan, buoyed by his party’s strong showing, pledged a “stronger economy and politics as well as democracy.” Close

Turkish Prime Minister Recep Tayyip Erdogan, buoyed by his party’s strong showing,... Read More

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Photographer: Adem Altan/AFP via Getty Images

Turkish Prime Minister Recep Tayyip Erdogan, buoyed by his party’s strong showing, pledged a “stronger economy and politics as well as democracy.”

‘Insidious Plans’

“The time has come to weed them out,” Erdogan told thousands of jubilant supporters in Ankara, repeating a pledge he made on the campaign trail. “The nation has foiled insidious plans and immoral traps.” He called the results a defeat for the “politics of lies and montage,” referring to the recordings.

The nation’s financial markets have plunged since news of corruption investigations emerged in December, though they rallied in the week leading up to the balloting. Bonds and the lira extended gains today on expectations Erdogan’s margin of victory will help stabilize the country.

“This is a bullish signal in the near term,” Benoit Anne, head of emerging markets strategy at Societe Generale SA in London, said in an e-mailed note. “Investors are not keen on heightened political uncertainty.”

The lira rose to a three-month high, adding 1.7 percent to 2.154 per dollar at 4 p.m. in Istanbul. That pares its loss since the corruption charges became public on Dec. 17 to about 6 percent. Yields on benchmark two-year bonds dropped 10 basis points to 10.69 percent. The benchmark equity index, which rallied 7 percent last week, fell 0.1 percent.

More Pressure

Turkey's Political Divide

Societe Generale’s Anne warned that tensions may persist because “the political year is not over,” with presidential elections due in August.

There were hints after last night’s results that Erdogan might seek that post. His deputy premier, Emrullah Isler, said the local ballot victory will “naturally” have an impact on the presidential race. Erdogan himself told supporters: “Tomorrow, we may not be in our posts,” and promised to serve the nation no matter his position.

Kemal Kilicdaroglu, head of the main opposition Republican People’s Party, which won 28 percent nationwide, said Erdogan’s threat to get rid of his opponents was a sign of things to come.

“Everyone will see pressure increase,” Kilicdaroglu said during a televised news conference. “Democracy is being threatened in the style of a dictator.”

Erdogan’s AKP has roots in Islamist movements and has won support by easing curbs on religion imposed by previous secular administrations. Its appeal is also based on economic growth that has averaged more than 5 percent a year under his rule.

Economists have cut their growth forecasts for this year amid the political crisis and the slide of the lira, which led the central bank to raise interest rates in January. The median estimate in the latest Bloomberg survey of economists on March 27 was 2.2 percent.

Erdogan pledged after the vote to bring “a stronger economy and politics as well as democracy.”

To contact the reporters on this story: Selcan Hacaoglu in Ankara at shacaoglu@bloomberg.net; Onur Ant in Ankara at oant@bloomberg.net

To contact the editors responsible for this story: Andrew J. Barden at barden@bloomberg.net

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