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Turkey Letter: 13 February 2017

Foreign Politics

  • Donald Trump Speaks to Turkish and Spanish Allies, Touts NATO’s Importance
  • No decision yet on arming Kurds to fight Islamic State, Trump tells Turkish leader
  • Erdogan Curbs Criticism of Trump, Seeking Warmer Relationship
  • S. VP Pence heralds ‘new day’ in relations with Turkey: Turkish PM’s office
  • CIA chief, Turkish PM discuss closer anti-terror cooperation
  • Russian Airstrike Kills 3 Turkish Soldiers in Syria in ‘Friendly Fire’
  • Turkey’s Erdogan wants to establish a safe zone in the ISIS capital Raqqa
  • Turkey-backed forces make important progress in Syria, foreign minister says

Economy & Energy

  • Sympathy for Turkey’s cenbank chief, but investors unconvinced
  • Turkey’s central bank seen staying difficult course until inflation peaks
  • No changes to management or activities of companies in Turkey wealth fund, minister says
  • EU slashes Turkey growth outlook slightly
  • Discounts on Turkish Stocks Show Rally Has Legs
  • Turkey could take tax steps to help auto sector, minister tells CNN Turk
  • Bankers Wanted for Turkey’s Planned $200 Billion Wealth Fund

Domestic Politics

  • Turkey to hold referendum on stronger presidency on April 16
  • Expulsions roil MHP as ‘base divided’ ahead of Turkey’s constitutional referendum
  • Turkish police fire tear gas, detain 12 in protests against dismissals
  • Turkey dismisses some 4,500 more state employees
  • Over 1,000 detained in nationwide terror operations in one week in Turkey
  • In Istanbul, Surprise That Trump Towers Complex Is Linked to Trump

Foreign Politics

Donald Trump Speaks to Turkish and Spanish Allies, Touts NATO’s Importance

President Donald Trump spoke Tuesday with President Recep Tayyip Erdoğan of Turkey, a key ally in the U.S.-led fight against Islamic State, for the first time since taking office last month.

Wall Street Journal, Donald Trump Speaks to Turkish and Spanish Allies, Touts NATO’s Importance, February 7, 2017


No decision yet on arming Kurds to fight Islamic State, Trump tells Turkish leader

Turkish President Recep Tayyip Erdogan sought to convince President Trump in a telephone call that arming Kurdish fighters in Syria to fight the Islamic State would be counterproductive to the military effort and damaging to already strained ties between the United States and Turkey, American and Turkish officials said Wednesday.

Washington Post, No decision yet on arming Kurds to fight Islamic State, Trump tells Turkish leader, February 7, 2017


Erdogan Curbs Criticism of Trump, Seeking Warmer Relationship

President Recep Tayyip Erdogan of Turkey and the officials around him rarely miss a chance to call out Western hostility toward Islam. Yet in recent weeks, Mr. Erdogan has kept quiet as President Trump has taken office and signed an executive order banning immigration from seven predominantly Muslim countries.

New York Times, Erdogan Curbs Criticism of Trump, Seeking Warmer Relationship, February 11, 2017


U.S. VP Pence heralds ‘new day’ in relations with Turkey: Turkish PM’s office

U.S. Vice President Mike Pence told Turkish Prime Minister Binali Yildirim it was a “new day” in Turkish-U.S. relations in a phone call on Thursday to discuss cooperation in the fight against terrorism, Yildirim’s office said in a statement.

Reuters, U.S. VP Pence heralds ‘new day’ in relations with Turkey: Turkish PM’s office, February 7, 2017


CIA chief, Turkish PM discuss closer anti-terror cooperation

Officials say Turkish Prime Minister Binali Yildirim has met CIA chief Mike Pompeo and they agreed on closer cooperation against terrorism and organized crime. Pompeo arrived in Turkey on February 9, making his first overseas trip since taking office.

Associated Press, CIA chief, Turkish PM discuss closer anti-terror cooperation, February 10, 2017


Russian Airstrike Kills 3 Turkish Soldiers in Syria in ‘Friendly Fire’

A Russian airstrike killed three Turkish soldiers in northern Syria on Thursday, an attack that both countries described as an accident.

New York Times, Russian Airstrike Kills 3 Turkish Soldiers in Syria in ‘Friendly Fire’, February 9, 2017


Turkey’s Erdogan wants to establish a safe zone in the ISIS capital Raqqa

Turkish President Recep Tayyip Erdogan took his proposal for a Turkish-backed assault against the Islamic State’s self-proclaimed capital of Raqqa to the Sunni Arab states of the Persian Gulf on February 13, telling an audience in Bahrain that he wants to create a “safe zone” in that part of Syria.

Washington Post, Turkey’s Erdogan wants to establish a safe zone in the ISIS capital Raqqa, February 13, 2017


Turkey-backed forces make important progress in Syria, foreign minister says

Syrian rebels and Turkish special forces have together made important progress in northern Syria in the fight against Islamic State, Turkish Foreign Minister Mevlut Cavusoglu said on February 8.

Reuters, Turkey-backed forces make important progress in Syria, foreign minister says, February 8, 2017


Economy & Energy

Sympathy for Turkey’s cenbank chief, but investors unconvinced

With the Turkish lira off record lows and central bank borrowing costs at the highest in five years, this week was perhaps a good time for Governor Murat Cetinkaya to convince London’s fund managers he is up to the job.

Reuters, Sympathy for Turkey’s cenbank chief, but investors unconvinced, February 9, 2017


Turkey’s central bank seen staying difficult course until inflation peaks

Turkey’s central bank will stick with unorthodox measures to keep borrowing costs at five-year highs at least until inflation peaks this year, according to people familiar with its thinking, despite sharp criticism from investors.

Reuters, Turkey’s central bank seen staying difficult course until inflation peaks, February 8, 2017


No changes to management or activities of companies in Turkey wealth fund, minister says

There will be no change to the management and operational activities of Turkish companies whose stakes have been recently transferred to a new sovereign wealth fund, Turkey’s finance minister said on February 7.

Reuters, No changes to management or activities of companies in Turkey wealth fund, minister says, February 7, 2017


EU slashes Turkey growth outlook slightly

In its winter economic forecast, the European Commission forecasted a 2.8 percent growth for Turkey in 2017 and 3.2 percent growth in 2018. In its previous report, its 2017 and 2018 forecasts were 3 percent and 3.3 percent respectively.

Hurriyet Daily News, EU slashes Turkey growth outlook slightly, February 13, 2017


Discounts on Turkish Stocks Show Rally Has Legs

Turkish stocks could still have another 10 percent to gain, despite a rally so far this year that has propelled them to a place at the top of global indexes.

Bloomberg, Discounts on Turkish Stocks Show Rally Has Legs, February 7, 2017


Turkey could take tax steps to help auto sector, minister tells CNN Turk

Finance Minister Naci Agbal cited the government’s recent tax cuts on white goods, furniture and in the construction industry. The government is now talking to the auto industry and could take similar steps to help it or other sectors, he said.

Reuters, Turkey could take tax steps to help auto sector, minister tells CNN Turk, February 7, 2017


Bankers Wanted for Turkey’s Planned $200 Billion Wealth Fund

Turkey is seeking to recruit senior bankers to help run the country’s newly-established sovereign wealth fund, according to people with knowledge of the matter.The Turkey Wealth Fund Management Inc., approved by parliament in August, is working with international executive search firms to hire for positions including chief investment officer and chief financial officer, said the people, asking not to be identified as the discussions are private.

Bloomberg, Bankers Wanted for Turkey’s Planned $200 Billion Wealth Fund, February 7, 2017


Domestic Politics

Turkey to hold referendum on stronger presidency on April 16

Turkey will hold a referendum on April 16 on replacing its parliamentary system with the stronger presidency long sought by incumbent Tayyip Erdogan, electoral authorities announced on Saturday.

Reuters, Turkey to hold referendum on stronger presidency on April 16, February 11, 2017


Expulsions roil MHP as ‘base divided’ ahead of Turkey’s constitutional referendum

Nationalist Movement Party (MHP) Deputy Chair Semih Yalçın has admitted that the party’s base includes people who plan to vote “no” in the upcoming constitutional referendum, as the MHP referred four dissident members to its disciplinary board.

Hurriyet Daily News, Expulsions roil MHP as ‘base divided’ ahead of Turkey’s constitutional referendum, February 13, 2017


Turkish police fire tear gas, detain 12 in protests against dismissals

Turkish police detained at least 12 people and fired tear gas to disperse hundreds more protesting outside Ankara University against the dismissal of dozens of professors, police sources and Reuters witnesses said.

Reuters, Turkish police fire tear gas, detain 12 in protests against dismissals, February 10, 2017


Turkey dismisses some 4,500 more state employees

Turkey’s government has sacked nearly 4,500 more state employees as it appeared to press ahead with a purge of people with suspected links to a U.S.-based cleric accused of orchestrating a failed military coup.

Associated Press, Turkey dismisses some 4,500 more state employees, February 7, 2017


Over 1,000 detained in nationwide terror operations in one week in Turkey

Over 1,000 people have been detained in a week since Feb. 6 in nationwide terror operations targeting various outlawed groups, the Turkish Interior Ministry announced on Feb. 13.

Hurriyet Daily News, Over 1,000 detained in nationwide terror operations in one week in Turkey, February 13, 2017


In Istanbul, Surprise That Trump Towers Complex Is Linked to Trump

The mall was named for him. His name adorns signposts at the nearby metro station. It also looms from the sides of the twin skyscrapers that the mall sits beneath. Yet many of the diners, shoppers and store owners here at Trump Towers Istanbul on a recent evening could not quite believe that the complex — among the tallest buildings in one of the world’s largest predominantly Muslim cities — had anything to do with President Trump.

New York Times, In Istanbul, Surprise That Trump Towers Complex Is Linked to Trump, February 8, 2017