Turkish Politics: I know what you will have done this summer

TURKEY - In Brief 09 Jun 2025 by Atilla Yesilada

---

Executive Summary: Fork in the road With the fall of Assad regime in Syria, Ocalan’s call for peace and the arrest of Imamoglu and several other CHP mayors, Turkey has truly reach a historic fork in the road. One path leads to a truce among rival parties and their respective constituencies, enshrined by a new constitution which will establish reasonable checks and balance between the executive, judiciary, the legislature and local administrations. Clearly, this is the good case scenario for the economy and markets. However it commands less odds (perhaps 35%) vs the Dark Path, which envisions a brutal battle for supremacy between AKP-MHP on one hand and all the other major opposition parties on the other. This path leads to total annihilation of major rivals to the ruling Republic Alliance (AKP-MHP), namely CHP and pro-Kurdish DEM Party, culminating in non-competitive elections or even their postponement by parliamentary vote or High Election Council (HEC) ruling. Needless to say, the dark path (commanding 65% probability) will wreck the economy by way of sporadic confidence shocks and wary depositors taking flight out of the financial system or to FX deposits. At this juncture, all the major actors are repositioning for the upcoming round of negotiations, polishing their political assets to gain leverage over the rivals. Erdogan seems to want to completely destroy CHP and its leading presidential candidates, not only to pave the way for gaining eligibility, but also to eliminate his dangerous rivals to make it easier for him to be reelected. MHP under the leadership of ailing Bahceli is irrevocably invested in the Peace Process with Kurds, and may at some point realize...