War in the time of corona
In March, we expect political instability to climb gradually in Turkey with or without the Idlib War, reaching a crescendo if Covid-19 comes a’knocking and forcing “changes” in the tenuous political equilibrium.
Peace or ceasefire in Idlib is not a likely scenario. We give Turkey 70% odds to push the Syrian Army behind M4-M5 highways. We still think as President Erdogan gravitates towards the West, Putin will idle his deadly air force rather than losing Turkey, but here the odds are 50-50.
If close to a million refugees march towards Greece and Bulgaria; Balkan, Eastern European states and Germany are likely to panic, trying to appease Erdogan, though sending soldiers remains out of questions, and money will be offered instead. EU is incapable of reimbursing Turkey a sum that would make a difference to the ever-rising military and welfare expenditures, which is our base-case scenario.
Corona arriving in Turkey could completely compartmentalize the Middle East economically, hurting Turkish tourism and trade significantly, as well as crashing the health system and consumer sentiment.
As polls reveal a modest slide in AKP-MHP votes, our assessment of advantages and risks from their vantage suggest that the ripples of voter rebellion could turn easily into a riptide that may cause early elections, large defections from AKP, or still the drastic and positive policy change the politics author has been hoping from Erdogan.
Please note that given the urgency and fluidity of the political developments, and the resulting length of the report, we’ve decided to devote today’s piece only to politics, which we shall follow up with an economics update by mid-week.
Now read on...
Register to sample a report