Will Erdoğan dismiss Şimşek?

YetkinReport writer Murat Yetkin stated that there were rumors in the markets that Erdoğan would dismiss Mehmet Şimşek after the election, and that economic circles interpreted this as “it would mean a u-turn from Turkey’s Medium Term Program (MTP) to get out of the economic crisis.”

The relevant part of Murat Yetkin’s article titled “Behind the scenes of the last increase in the dollar and the codes of Şimşek’s exit” is as follows:

“Capital circles in Istanbul believe that the rumor that has been spreading in the market since last week that ‘Erdogan will dismiss Şimşek after the election’ has a share behind this increase.

It is possible to observe that this rumor extends to foreign investment experts who are in Turkey to smell the political and economic atmosphere before the election and to make post-election predictions. I observed and reported that some experts I had the opportunity to meet recently asked questions about whether Şimşek would leave after the election. Moreover, those who asked this question did not believe that it was true, because they believed that this would mean Turkey’s u-turn from the Medium Term Program (MTP) to get out of the economic crisis.

In fact, the address of Şimşek’s detailed statement in English from his X account on March 11 was these rumors that also reached foreign investors.

ŞİMŞEK’S CODES

The prominent sentence in Şimşek’s message was that ‘the fluctuation in the foreign exchange market is temporary’. The message, published in Turkish by Anadolu Agency in a short time, also contained other important elements.

First of all, after the election, ‘the program would continue’ and even structural reforms would be implemented. As a matter of fact, in Şimşek’s statement, we see that the Central Bank Governor Fatih Karahan’s request for ‘fiscal policy support in the fight against inflation’ was given a positive response.

The reason why the reforms were not carried out now due to electoral economics was not clearly stated, but it included Turkey’s statement that there was a ‘long period without elections to implement the Medium Term Program’.

This meant that no elections were foreseen, at least within the three years in which the OVP was expected to be valid. It is highly unlikely that Şimşek would make such a statement without President Erdoğan’s knowledge. When Şimşek says ‘long term without elections’, he means the period until the 2028 elections. “The statement does not coincide with the early election formula of the Deputy Speaker of the Grand National Assembly of Turkey, Bekir Bozdağ, with the decision of the Parliament to give Erdoğan a chance to enter the Presidential election once again.”