After Election Sweep Turk Islamists Look to EU Markets

ANKARA (Reuters)–A new and untested conservative party with Islamist roots pledged on Monday to speed economic reform and moves to join the EU after a spectacular victory in Turkey’s general election which swept out the old order.

The Justice and Development Party (AKP)–which vehemently rejects the Islamist label but whose victory raised deep concerns in Turkey’s secularist establishment–sought to play up its pro-Western–pro-market policies–vowing to send envoys to the European Union and safeguard an economic reform package.

Turkey’s closest ally–the United States–will be eager to see a new cabinet in office in about two weeks–the minimum time it will take to form a government. Washington would look to NATO-member Turkey for support in providing air bases and other facilities for any attack on neighboring Iraq.

"We are bound by the UN’s decision–we cannot say anything before seeing the UN’s attitude towards the issue," AKP leader Recep Tayyip Erdogan told reporters on Monday–referring to moves in the UN Security Council to try to agree a tough new resolution on disarming Iraq.

"We don’t want blood–tears and death. We hope the issue will be solved peacefully."

The unexpected scale of the AKP’s victory–routing parties blamed by voters for a grueling economic crisis–will test the fabric of the AKP itself. Founded only a year ago–the party has little experience of power–faces a court case to outlaw it and has a leader banned from taking up any government post because of a past conviction for Islamist sedition.

LIQUIDATION OPERATION

The Sabah daily called the AKP victory a revolt by Turkey’s increasingly impoverished Anatolian heartland. "Politics has never seen such a widespread liquidation operation," it said.

Provisional results gave the party more than 360 seats in a 550-seat assembly. Only one other party–the Republican People’s Party (CHP)–mustered the 10 percent needed to enter parliament.

Veteran Prime Minister Bulent Ecevit–his fifth term in office drawing to a close–saw his party’s vote sink from 22 percent in 1999 to little over one percent.

Former Economy Minister Kemal Dervis–architect of Turkey’s $16 billion rescue programme and a CHP deputy–said the election result could provide Turkey with much-needed stability.

"If we can create a constructive–tolerant working environment and if there is respect for the constitution and clear respect for the concept of the secular republic then I think this election will be useful for Turkey," he said.

The World Bank–which has committed some $6 billion in loans–said in a statement: "The Bank welcomes the election outcome in Turkey which will enhance political stability."

But some in Turkey had misgivings.

"The AKP isn’t ready to govern Turkey alone and I’m not sure even they wanted that," said Rusen Cakir–author of a book on Erdogan. "To govern alone they really need time to prepare–gain legitimacy and stature on the domestic and international stage."

But Turkey needs to quickly establish market confidence and safeguard the IMF pact. Urgent issues must be tackled in the coming month in pursuit of Turkey’s EU membership ambitions.

Erdogan said he planned to visit Greece within 10 days to discuss EU issues and would send envoys to the EU immediately.

"We don’t have much time," he said.

The EU welcomed Erdogan’s enthusiasm but stressed the AKP would be judged on its actions.

"There is clearly a will to pursue rapprochement with the European Union," EU foreign policy chief Javier Solana told the French daily Le Monde. "We will have to judge the next Turkish government by its acts."

Ali Coskun–tipped as a possible economy minister–told Reuters an AKP government would complete reforms needed to earn the next $1.6 billion IMF loan payment before discussing possible revisions to the programme.

STRAIGHT TO WORK

Party sources said the AKP was drawing up a cabinet list to present to President Ahmet Necdet Sezer–who must await official results in four days before formally inviting the AKP to form a government.

The Turkish lira–down more than 50 percent against the dollar since a 2001 crisis–sank to all time lows of over 1.7 million in early trading on Monday before bouncing back–reassured by commen’s from AKP officials on the IMF programme.

The main stock index soared six percent on optimism a one-party government would be more effective than a string of bickering coalitions in recent years.

Kasper Bartholdy–senior emerging markets economist at CSFB–said of the AKP: "They’ve made all the right noises to the market in terms of what they had promised to the international community beforehand–that they would give priority to keeping the IMF programme going in particular."

Erdogan will chair a meeting on Tuesday to discuss a candidate for prime minister. Meanwhile Ecevit will lead a caretaker cabinet.

The secularist establishment–the army–state apparatus and judiciary–will watch Erdogan’s progress keenly for any sign of Islamist tendencies. But the generals–a force in Turkish politics–are unlikely to make any public declarations.

The AKP was formed from the "modern" wing of a party banned last year for Islamist militancy. Erdogan appears to have learnt from the fate of Turkey’s first Islamist government–forced out after a year by an army-led pressure campaign.

The constitutional court is weighing a case to outlaw the AKP on grounds it breached laws on forming parties. Erdogan also faces trial on charges of illegal earnings dating from his days as Istanbul mayor.

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