(Updates with Erdogan comments in fourth paragraph.)
July 6 (Bloomberg) -- Turkey’s Prime Minister Recep Tayyip Erdogan unveiled a 25-member Cabinet tasked with rewriting the constitution and expanding the economy in his third term.
The restructured ministries are little changed from the premier’s last term in office, with key deputies including Ali Babacan, Ahmet Davutoglu, Mehmet Simsek and Bulent Arinc retaining their posts, Erdogan said today in Ankara.
Erdogan has promised to rewrite the constitution drafted after a 1980 coup by the secularist military. He needs support from at least three opposition lawmakers to put the new charter to a referendum and votes from 40 to pass it straight into law. His party faces an unprecedented opposition boycott in parliament, with about a third of the 550-member assembly refusing to take the oath of office, protesting court and electoral board decisions barring nine jailed lawmakers from joining the legislature.
“The main opposition party is neglecting its duty by not participating in parliament,” Erdogan said after announcing the cabinet. “Our desire is that the opposition will be sworn in and take its place in the assembly.”
Erdogan will on July 8 present his agenda to parliament, which will hold a vote of confidence as soon as July 13 and no later than July 15, when the assembly is scheduled to adjourn until October.
Gross domestic product growth has averaged more than 5 percent annually since Erdogan’s Justice and Development Party, or AKP, took office, compared with 1.5 percent in the previous five years, according to data on the Treasury’s website.
Babacan, who has overseen Turkey’s economic recovery from a banking crisis in 2001 and subsequent record growth, was reappointed as a deputy prime minister. Simsek remains finance minister, Zafer Caglayan will be the minister in charge of foreign trade and Taner Yildiz continues as head of the Energy Ministry.
“The picture seems to be one of continuity,” Inan Demir, chief economist at Finansbank AS in Istanbul, said today in an e-mail. “Continuation of Babacan and Simsek in their posts constitutes a market friendly line-up.”
Foreign Minister Davutoglu, architect of the “zero- problems” with neighbors doctrine, kept his post as Turkey hosts more than 9,000 Syrian refugees fleeing a crackdown and prepares to host the next Libya contact-group meeting.
EU’s Boycott Concern
Arinc, an AKP founder who has also served as speaker of parliament, stays on as deputy prime minister. The premier named Egemen Bagis, previously Turkey’s lead negotiator with the European Union, to head the newly created ministry in charge of affairs with the 27-member bloc.
The EU is monitoring the parliamentary boycott “closely and with concern,” spokeswoman Maja Kocijancic said yesterday, according to state-run Anatolia news agency.
Main opposition Republican People’s Party, or CHP’s two members are imprisoned in connection with investigations into alleged coup plots to topple Erdogan’s Islamic-leaning government. The defendants and the CHP have called the trial a “witch hunt” against government opponents.
“The CHP are playing a high-risk game over this issue, but the risk is that Erdogan calls their bluff, with the CHP losing yet more political capital as a result,” Tim Ash, chief economist for emerging markets at Royal Bank of Scotland Group Plc in London, said today in an report before the cabinet was announced. “Indications are that we might see the party relent.”
Independents backed by the pro-Kurdish Peace and Democracy Party, or BDP, are in jail on allegations of supporting the Kurdistan Workers’ Party, which is listed as a terrorist organization by Turkey, the U.S. and the European Union.
CHP and BDP-backed lawmakers refused to be sworn in to parliament June 28. Erdogan said today that the AKP won’t press for a July 15 deadline to resolve the boycott.
The week-long protest may be resolved after main opposition leader Kemal Kilicdaroglu meets with Cemil Cicek, the speaker of parliament, according to Hurriyet newspaper. Cicek is expected to take on an “active” role to solve the problem in exchange for CHP deputies taking their oath and joining the legislature.
--With assistance from Steve Bryant in Ankara.
--Editors: Aydan Eksin, Louis Meixler
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