Turkish PM Bows to Pressure And Agrees Polls

ANKARA (Reuters)–Turkish Prime Minister Bulent Ecevit bowed to pressure from government partners on Tuesday and agreed to call early polls in November in the hope of ending turmoil that has shaken markets and raised concern among NATO allies.

Ecevit–however–appeared determined to keep his rocky three-party government in power until the polls–which promise to be crucial to Turkey’s future direction. Parties could vanish from parliament–new ones may rise to prominence.

The ailing Ecevit faces an exodus from his party of deputies now trying to build a new centrist front to fight the polls.

Their new "Troika"’ party is seen by markets as the great hope to keep a multi-billion dollar IMF-backed pact on track.

"The three leaders have reached agreement on holding an early general election on November 3–2002," the leaders said in a short statement following an hour-long meeting.

Turks–ravaged by the unemployment and poverty of the worst recession since 1945–are like markets and foreign allies seeking a clear outcome from polls in a country haunted by decades of indecisive government.

Markets look to a government to implement the IMF pact sealed after two crushing crises in less than two years.

Current government allies have pledged to enforce the pact but doubts linger. Minds may now be distracted by campaigning.

Only two weeks ago–the same three coalition leaders moved against speculation the government was driven and weakened by Ecevit’s illnesses and declared they would see the government through to 2004 – when parliament’s five-year term expires.

Then Devlet Bahceli–head of the Nationalist Action Party (MHP) which is in the coalition–said the government was seen as disunited and elections had to be held in November.

"The market really has to learn and say–look–we are four years down the line…Are we returning to the period of the 1990s when we had a new government every year or are we on the point of a new era?" asked Sheetal Radia–analyst at Standard and Poors MMS in London.

Two more deputies quit Ecevit’s Democratic Left Party (DSP) on Tuesday–taking the government below the technical majority of 276 seats. But there was no immediate danger of collapse after Ecevit persuaded a bloc of nine disaffected men to stay.

It now seems unlikely that 77-year-old Ecevit’s government–which carried out major and historic reforms despite recurring internal conflicts that later became intolerable–will now face a vote of no confidence.

Parliament will reconvene from summer recess in September to vote on holding the November election.

Mixed Feelings About Polls

There may be some relief that polls have now been called after weeks of bluster and uncertainty that have depressed markets–brought the lira currency to all-time lows and pushed up the cost of Turkey’s massive debt burden. But the outcome is very uncertain.

Ecevit’s DSP–its parliamentary group almost halved by defections since Bahceli’s election call–may well fall below the 10 percent threshold necessary to enter parliament.

The same fate could await the junior coalition partner–Motherland–the MHP and established opposition parties.

The powerful military may be anxious about opinion polls suggesting the new AK Party–viewed with suspicion by generals for its Islamist roots–could emerge as the biggest group.

The military spearheaded a pressure campaign in 1997 that led to the fall of the country’s first Islamist government. A clampdown on political Islam continues and AK’s leader–Recep Tayyip Erdogan–may be barred from parliament by legal actions.

If AK gain power the military would face difficult choices. Intervention of whatever kind–even if reluctantly entered into–would deal a blow to EU prospects vital to foreign investment.

"The role of AK is going to be very important as well in the light of US-Turkish relations–important if the US is going to attack Iraq," said Caroline Gorman–a London-based analyst.

US Deputy Secretary of State Paul Wolfowitz met Ecevit on Tuesday for talks believed to have focused on Iraq.

Turkey is opposed to US military intervention in Iraq as part of its "war against terror," fearing a conflict in the region would further imperil its crisis-hit economy.

But NATO ally Turkey borders Iraq and hosts airbases used by the United States and Britain to launch patrols of a no-fly zone over northern Iraq. Turkey’s support as a stable front-line state could be crucial in any US military campaign against Baghdad.

The hopes of many will rest with the new "Troika" of leaders – Economy Minister Kemal Dervis–former deputy premier Husamettin Ozkan and ex-foreign minister Ismail Cem.

The latter two resigned last week from Ecevit’s government–arguing it lacked the authority to push through economic policy and rights legislation urgently required to push the country’s European Union membership bid.

The three are creating a new centrist party. It may have strong support in the big cities of Istanbul–Ankara and Izmir but could struggle to muster admirers in the rural areas of Anatolia which may yet favor AK or even the MHP.

"A few months ago the prospect of elections was quite frightening," Gorman’said. "At least now we have the prospect of this Cem-Ozkan combination."

Economy Minister Dervis now appears in place to oversee the IMF plan until polls.

"Given that Dervis has been hauled back–I think that’s probably the most important thing for the market in the short term," she added.


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