TÜRKİYE ORTA ASYA HABER KKUORDİNATÖRÜ

WORLD TURKISH NEWS As Turkey approaches the end of 2026, it is undergoing a significant transition period. Politically, the country faces deep polarization and a struggle for democratic resistance, while economically it is experiencing a painful but steady shift towards traditional "orthodox" fiscal policies to combat record-high inflation. Political Trajectory Türkiye's political landscape is characterized by a concentration of executive power and a growing challenge from the opposition. Deepening Polarization: Society is divided between pro-government conservative groups and secular, nationalist, and social democratic opposition groups. Trust in public institutions such as the judiciary and the central bank is distinctly divided along these party lines. Opposition Gains: The main opposition party, the Republican People's Party (CHP), achieved a historic victory in the 2024 local elections, taking control of key economic centers such as Istanbul and Ankara. This situation has positioned figures like Istanbul Metropolitan Mayor Ekrem İmamoğlu as potential rivals in the 2028 presidential elections. Systemic Tensions: Recent political developments include a series of legal actions and "trustee" appointments in which pro-government officials have replaced several opposition mayors. While critics argue this represents a slide toward greater autocracy, the government claims these actions are for national security. Geopolitical Goals: Internationally, Turkey maintains its "strategic ambiguity," balancing its role as a key NATO ally with increasing ties to Russia and China. It positions itself as a regional power in the Black Sea, the Middle East, and Central Asia. World Turan Foundation Economic Trajectory Following years of unconventional "low interest rate" policies that led to significant currency devaluation, Turkey is now committed to a rigorous stabilization program. Return to Orthodoxy: From late 2023 onwards, the government adopted a standard monetary policy. Interest rates remained high to cool the economy and curb inflation, reaching 50% in early 2024. Progress in Declining Inflation: Inflation, which reached approximately 75% in mid-2024, is gradually declining. Projections show inflation will fall further to a range of 15% to 23% by 2026, but the cost of living remains a significant burden for the middle and lower classes. Growth and Resilience: Despite the slowdown caused by high interest rates, real GDP growth is expected to remain strong, between approximately 2.7% and 3.2% by 2026. The economy continues to benefit from a young workforce and a strong industrial base, particularly in the defense, automotive, and textile sectors. External Risks: The economy remains vulnerable to political turmoil. Investors are closely watching for signs of continued judicial independence and political stability, as sudden crackdowns on opposition figures have in the past triggered sell-offs in the Turkish lira and the Istanbul stock exchange.