Turkey is locked in ahead of local elections to be held on March 30. Politicians from diffirent parties noted that the election has various meanings
ISTANBUL — Not only politicians but also economists, businessmen, and national and international finance executives are watching keenly as Turks head to the polls. Morever, Borsa Istanbul poses dramatic incearese with the positive expectation out of local election and exceeds 69,500 points which is highest of three months.
Turkey's Finance Minister Mehmet Şimşek made statements about possible results of the election and its repercussion on economy. Şimşek said "If the AK Party receives more than 40 percent of the votes in the upcoming local elections, prospective uncertainties regarding the presidential elections in Aug. 2014 will be limited." He added "If the AK Party gets 40 percent or more of the vote, it means the uncertainty about the presidential elections will have a limited effect on the economy," said Şimşek. "As such, the risk of diminished growth would be based on monetary tightening. In the case of monetary tightening, real interest rates are relatively lower even though nominal interest has increased."
According to Ümit Kiler, executive board member of Kiler Holding, one of the largest companies in Turkey, the country has been ruled by a powerful party and leader for more than a decade. This has been key for economic stability in Turkey. "Unfortunately, the March 30 local elections lost their locality and are treated as parliamentary elections would. I think the AK Party has preserved its vote rate from the last election in 2011," Kiler said.
Referring to the so-called corruption operations, Kiler said malevolent people have tried to spoil the business environment in Turkey. "Some people wanted to damage Turkey's increasing esteem, but I believe the result of the elections will eliminate the bad impressions about Turkey's economy," he added. He also noted that "Kiler Holding signed a $120 million credit agreement with Merill Lynch. They would not release that credit if they didn't trust the Turkish economy."
Economist Dr. Cemil Ertem said financial market players regard these local elections as a rehearsal for the presidential election in August 2014 and general election in 2015. Dr. Ertem noted that "international fund managers quoted the shares stock market in Turkey and made huge investments assuming the AK Party's probable win on March 30." Touching on JP Morgan's report foreseeing an AK Party win and its implications, Dr. Ertem said: "The finance world will keep their eye on the election and they will enjoy the stability after the election."
Mahmut Asmalı, owner of Ak Yapı, one of the largest construction companies in Turkey, said: "This local election means a lot. If the AK Party wins the election, stability, which is a magnet for foreign direct investment and foreign buyers, will remain in the country because this local election turned into a duello between the good and the bad." Asmalı further added that after March 30 people expect the AK Party to implement new regulations to prevent economic attacks aimed at destabilizing the country. Economist Dr. Erdal Karagöl spoke to Daily Sabah regarding the upcoming elections and the potential economic repercussions. Karagöl highlighted the correlation between economic stability and political stability. He confirmed that macroeconomic indicators show that Turkey has been doing really well recently. Foreign funders prefer to settle in Turkey thanks to stability and a fruitful business environment. Emphasizing the reports released by Standard & Poor's and J.P. Morgan, Karagöl said: "Turkey is followed by many abroad. They read Turkey better than us and they see a stable future for Turkey."