On Sunday, June 7, Turkish voters will go to the polls to elect members of the country’s parliament. President Recep Tayyip Erdogan, the former prime minister, is not up for reelection this year. Yet he is at the center of the campaign and Turkey’s struggle to see its way forward. Under Erdogan’s leadership the ruling Justice and Development Party (AKP) has had an unbroken string of electoral victories since 2002, largely on the strength of its economic record. The AKP government of Erdogan tamed a chronic budget deficit, lowered inflation, and fostered the interests of the Islamist business class in Turkey’s interior.
Things have changed. Under AKP internal rules, Erdogan can’t serve in parliament and be prime minister more than three terms consecutively. So voters elected him president, traditionally a ceremonial and nonpartisan post in Turkey. Yet he is campaigning hard for the AKP. If it wins an overwhelming majority in the parliament, it can successfully vote to change the constitution and switch the real political power in Turkey from the parliament to the presidency. Then Erdogan could conceivably run Turkey until 2024, when term limits take effect.
Erdogan’s focus on political transformation has left the AKP vulnerable to attack on its recent handling of the economy. The Turkish lira has slid 13 percent in value against the dollar. The president has quarreled publicly with the head of the central bank for raising rates sharply to curb resurgent inflation and lower the economy’s dependence on imports. Growth, which averaged 5 percent through most of the Erdogan era, will likely drop to 3.2 percent this year, slow for a country that needs to create jobs for a young population. If the U.S. Federal Reserve raises rates, many market investors will probably drop Turkish bonds for American Treasuries, weakening the lira more. Consumer confidence is at depths last seen during the global financial crisis.
“For the first time, AK Party finds itself following the economic agenda rather than setting it,” says Cagdas Sirin, an economics professor at Bahcesehir University in Istanbul. “I don’t know whether this will be reflected at the ballot box, but the No. 1 issue for voters is the economy.” The AKP has been leading the polls, but keeping its parliamentary majority is uncertain.
Opposition parties are making generous promises to win votes. The main opposition, the secularist Republican People’s Party (CHP), says it will raise the monthly minimum wage by 50 percent to 1,500 liras ($560), lower the price of diesel fuel for farmers, and build affordable housing for poor and middle-class voters. The pro-Kurdish People’s Democratic Party (HDP) has proposed a minimum wage of 1,800 liras.
For Huseyin Yildiz, a previous AKP voter who says his watermelon business in an Ankara market is slow, higher minimum wages have their appeal. “I hope they can keep their promises,” he says of the opposition. “That means more money for everyone. Who doesn’t want that?” In response, Deputy Prime Minister Ali Babacan has warned that the opposition’s minimum wage proposals would turn the country into another Greece. There are also concerns that Erdogan’s imperious style is eroding the rule of law. The president’s lawyers are opening hundreds of lawsuits against people for insulting him. The courts have detained dozens of journalists for allegedly writing insults in social media, getting involved in coup plots, and supporting Kurdish terrorists.
Most election surveys show combined support for the CHP and the Nationalist Movement (MHP) at more than 40 percent, close to the AKP’s predicted result. If the HDP passes the 10 percent total vote threshold needed to enter parliament, no party may win enough seats to form a government alone.
Investors may not see the lack of a single-party majority as a bad thing, according to Abbas Ameli-Renani, global emerging-markets strategist at asset manager Amundi in London. He said in an e-mail, “After 13 years of absolute majorities for the AKP, a weaker vote of confidence may be exactly what is needed to refocus the party’s attention on the economic reform agenda that defined its earlier years in power.”
The bottom line: Although Turkey’s AKP has dominated the polls for a decade, its lead in this parliamentary election has narrowed.