TÜRKİYE ORTA ASYA HABER KKUORDİNATÖRÜ

IFJ-INTERNATIONAL FEDERATION OF JOURNALISTS CNBC: Politics Political and financial turmoil expected to dominate Türkiye, jeopardizing economic stability plans Turkish officials said on Monday that more than 1,100 people have been arrested in protests nationwide since the demonstrations began on March 19, and that political and economic instability has gripped the country of 85 million following the arrest of Istanbul Mayor Ekrem İmamoğlu last week. The future of Türkiye remains uncertain, but analysts expect prolonged volatility for the Turkish lira and the foreign exchange reserves it must use to stay afloat. The Financial Times reported on March 21 that central bank officials spent $12 billion in foreign exchange reserves last week to support the lira after it fell by over 40 percent against the dollar. Markets initially declined following news of the arrests, and on Sunday, Turkey banned short selling and relaxed buyback rules to support stocks. "The protests represent the most significant and widespread public outcry in over a decade, making it difficult to predict the course of events," Wolfango Piccoli, co-chairman of consultancy Teneo, wrote in a note on Monday. "Even at this early stage, it's clear that political uncertainty is far from over," he said. "President Erdoğan's political agenda has once again severely damaged Türkiye's economic outlook." İmamoğlu, considered Turkish President Recep Tayyip Erdoğan's most formidable political rival, was arrested on corruption charges just days before he was expected to be nominated as his party's presidential candidate. İmamoğlu and his supporters deny the accusations, saying they are politically motivated. Economists fear investor confidence has suffered a blow that could undermine the nearly 21-month effort by Türkiye's financial leaders to return to traditional monetary policy and address the country's runaway inflation. Finance Minister Mehmet Şimşek, appointed in June 2023, is being forced to implement emergency measures, such as spending record amounts of foreign exchange reserves to prop up the weakening lira, complicating long-term economic stability plans. "A significant portion of the foreign exchange reserves accumulated last year have evaporated in a matter of days," Balıkesir MP Burak Dalgın told CNBC. "This is definitely a blow to Şimşek's economic program. You save with a spoon, you shovel it away." "On the verge of becoming a dictatorship" Meanwhile, Erdoğan's widespread crackdown on opposition activities is intensifying. Since İmamoğlu's arrest, Turkey has imposed travel restrictions on Istanbul, closed bridges, and restricted internet access to curb the protests. Türkiye's official media outlets are not reporting the protests. Istanbul-based independent economist and consultant Arda Tunca told CNBC that the country is approaching a point of no return. "Turkey is on the verge of turning into a dictatorship. The people's reaction to what has happened since March 18th will determine the fate of the country's future," Tunca said. "No leader, democratic or not, can silence the will of the people sooner or later." According to Reuters, Erdoğan also denigrated the protesters over the weekend, saying his government would not "surrender" to "vandalism" or "street terror" ahead of planned demonstrations. On Monday, he said the protests had devolved into a "violent movement" and vowed that Türkiye's main opposition Republican People's Party (CHP), of which İmamoğlu is a member, would hold accountable the more than 120 injured police officers, according to the Interior Ministry. Critics of Erdoğan, both inside and outside Turkey, have been warning for years that the 71-year-old leader, who has been in power for more than two decades, is steadily eroding democratic rights and norms. This leader served first as prime minister from 2003 to 2014 and then as president from 2014 onwards. "Erdoğan's desire to steer Türkiye away from the competitive authoritarian model that has characterized the country's governance for the past decade and towards a full-blown autocracy is becoming increasingly evident," Piccoli wrote in Teneo. If Erdoğan's ruling Justice and Development Party (AKP) "were truly confident in its electoral dominance, there would be no need to neutralize İmamoğlu so early," Piccoli said. He also noted that Türkiye's presidential elections will be held in 2028. The AKP may believe that public anger will have subsided by then, but this move could also deter future political candidates from seriously challenging Erdoğan for the presidency. "The prosecution of İmamoğlu extends far beyond the fate of any single politician," Piccoli wrote.