In Sunday’s local elections, the Turkish people voted with their pockets. The parliamentary and presidential elections last May were far from fair. The winner could have been the popular mayor of Istanbul, Ekrem Imamoglu, who in May was disbarred before the race on the specious charge of “insulting” Turkey’s Supreme Election Council. 

Imamoglu had already defeated President Erdogan’s AKP (Justice and Development Party) twice. In the local elections in 2019, as a candidate for the main opposition party, CHP (Republican People’s Party), he defeated Erdogan’s chosen candidate, Binali Yildirim, by 13,000 votes. Following a complaint by the AKP, the election result was annulled. In the June re-run, Yildirim was again defeated by Imamoglu, with 54 percent of the vote against Yildirim’s 45 percent.  

This was a heavy blow to Erdogan, who had begun his political career as mayor of Istanbul in 1994. He had built up a war chest to fund the AKP in 2001 and secured its victory in the 2002 general elections. Accordingly, until Imamoglu’s victory, the AKP had held Istanbul since 2004. With nearly a fifth of Turkey’s population and 30 percent of Turkey’s GDP, the maxim “Whoever wins Istanbul wins Turkey” holds true. 

Last May, Imamoglu was blocked from running and replaced by the CHP’s (then) leader, Kemal Kilicdaroglu, whom Erdogan was confident of defeating. 

Sunday’s result of 51 percent of the vote for Imamoglu against 40 percent for his AKP rival Murat Kurum does not stand alone.

In the capital, Ankara, incumbent CHP mayor Mansur Yavas imposed a crushing defeat on his AKP rival with 60 percent of the votes. The CHP secured fourteen out of thirty metropolitan areas, including the largest, Istanbul, Ankara, Izmir, Bursa, Antalya, and Adana, as opposed to the AKP’s twelve.   

The CHP noted a victory in thirty-five of Turkey’s eighty-one provinces (against the AKP’s twenty-four) and overall gained 37 percent of the vote against the AKP’s 35 percent. A glance at the electoral map confirms that the Republican party’s victories are concentrated in the west of Turkey and its Aegean and southern coastal areas, the AKP’s in the Black Sea area and the Anatolian hinterland. In contrast, thethe victories of the pro-Kurdish DEM (People’s Equality and Democracy Party) are in the southeast.     

President Erdogan assessed that the foremost winner of the elections was Turkish democracy in his speech from the balcony of the AKP’s headquarters in Ankara. He conceded that the AKP and its ally, the MHP (Nationalist Movement Party), had not obtained the desired result and “lost height.” The party’s organs would evaluate the results and—ending on an optimistic note—said better economic outcomes, especially with regard to inflation, would be seen in the second half of the year.

Before last year’s May elections, one dollar in Turkey was equivalent to twenty lira, held up by back-door interventions. Now, it’s thirty-two lira. Erdogan’s heterodox campaign against interest rates, which he considered “the father and mother of all evil,” led to the removal of a brake against galloping inflation and a benchmark interest rate of 8.5 percent. 

Now, after last May’s elections, with the reinstatement of Mehmet Ali Simsek as finance minister, the rate has been raised to 50 percent. His appointment, therefore, seems as effectual as closing the stable door long after the horse has bolted. 

Erdogan has based electoral success on continued economic growth. Ten years ago, American economist Jesse Columbo warned that Turkey’s boom-or-bust economy, predicated on foreign “hot money” inflows and ultra-low interest rates, was heading for a bust. 

From 2019 to 2020, an estimated $128 billion was used to prop up the lira, and according to Bloomberg calculations, another $128 billion was spent from December 2021 to March last year. This has left Turkey’s central bank with depleted foreign exchange reserves and swap deals with Qatar, China,  South Korea, and the Emirates to avoid collapse. 

Rather than submit to the IMF’s tutelage, Erdogan embarked on a three-stop tour of Gulf states in July to seek trade and investment opportunities. In October, Mehmet Simsek did the same. This is why trade agreements are an important component in the process of rapprochement with, for example, Greece and Egypt.   

Although Fitch Ratings upgraded Turkey’s status to B+ with a positive outlook in March, it warned that $226 billion in external debt matured over the next 12 months, leaving Turkey vulnerable to changes in investor sentiment. 

Prior to the local elections, Erdogan vowed to make Turkey one of the world’s ten largest economies, stating, “We will ensure each of our people gets the share they deserve.” Yet, at the same time, in another rally, he admitted that recent increases in the minimum wage and pensions had failed to keep up with inflation.   

According to an official estimate, Turkey’s annual inflation increased to 67 percent in February, but according to an independent inflation group, ENAG, it is 122 percent.  

In 2023, Turkey’s budget deficit increased seven-fold from the previous year, no doubt because of government giveaways designed to increase the vote in May’s parliamentary and presidential elections. Another factor is the record increase in the allocation to the Religious Affairs Directorate (Diyanet) and the president’s discretionary fund.   

Millions of Turkish families have been pushed into poverty and have difficulty in meeting the cost of basic necessities. 

Undoubtedly, mismanagement of the economy has been the driving force behind the local election results. How far this will lead to political change remains an open question.

Robert Ellis is a Turkey analyst and commentator. He is also an international advisor at the Research Institute for European and American Studies in Athens.   

Image: Tolga Ildun / Shutterstock.com.