May 29, 2023: Turkish President Recep Tayyip Erdogan has secured a victory in the historic run-off of the presidential election, defeating Kemal Kilicdaroglu by a margin of 52.1% to 47.9%. With nearly all the ballots counted, Erdogan's win comes as a surprise after weeks of uncertainty surrounding his campaign.
Erdogan's re-election raises concerns among Western governments and international investors, as it could potentially lead to increased friction between Turkey and the global community.
Despite facing challenges such as a cost-of-living crisis and two devastating earthquakes, Erdogan demonstrated his resilience by leveraging the state media machine to divide the opposition alliance and mobilize his conservative base.
The focus now turns to Erdogan's economic policies and whether he will uphold his promise to maintain the current economic trajectory. Foreign investors are particularly interested in how he addresses the exodus of foreign funds from the country. Additionally, the delicate balance between Turkey's NATO allies and its relationship with Russia under President Vladimir Putin's ongoing war in Ukraine remains a crucial aspect for world leaders to monitor.
Economists anticipate an inevitable monetary policy adjustment, including a gradual rise in interest rates. While other central banks worldwide have increased rates to combat inflation, Turkey has followed Erdogan's call for low borrowing costs. However, with inflation surpassing 85%, adjustments are necessary to stabilize the economy.
Erdogan's victory will likely shape Turkey's foreign policy over the next five years. The country is expected to assert its role as a critical buffer for migrants heading to Europe and maintain its grain exports from the Black Sea. Turkey aims to foster peace in Ukraine while avoiding imposing sanctions on Russia, viewing them as counterproductive. Erdogan may also consider ratifying Sweden's bid to join NATO, but the decision is contingent on Sweden's implementation of new terrorism legislation. Moreover, he will prioritize the development of Turkey's defense industry to bolster the country's regional power status.
While Erdogan's victory extends his record rule, challenges await him in both the economy and foreign policy. The international community will closely watch how he navigates these issues in the coming years.
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