Erdogan Holds Key To Economic Stability

The protests that will mark their first full month on Thursday, June 27 raise a major question for long-term investors: Should they worry about political and economic stability in the country, and be wary before tying their money up in the Turkish market? The short answer is no, but it won’t hurt to be guarded.

It’s been clear that these protests revealed Turkish Prime Minister Recep Tayyip Erdogan’s limits in governing the country after almost 11 years in office. Umit Ozdag, chairman of 21st Century Turkey, an Ankara-based think tank, told Al-Monitor, “If those who receive only 6% of the national constituency votes forced him to open negotiations with the imprisoned Kurdistan Workers Party leader Abdullah Ocalan, think about the power of the 50% of the population who haven’t voted for him and is now on the streets.”

In brief, it really does not matter how harsh Erdogan criticizes the people in the streets. He is dependent on them to calm the streets to maintain the flow of foreign investment to the country and the hot money in the local markets. He can only guarantee his next term in office by keeping the economy out of trouble.

Technically, Erdogan must have ordered the planting of a hundred new trees as well as 152,000 flowers at Gezi Park last week as an olive branch to the protesters, but his rhetoric of the people on the streets protesting his polices being “enemies” cut him short. And that bipolarity about his character may certainly create concern in international markets by casting doubt on whether he is really committed to democracy. When he exclaimed, “Do excuse me, but this Tayyip Erdogan won’t ever change!,” many recalled his past cynical remarks comparing democracy to “catching a train. When you get to your station, you get off.”