Economic agenda of president of republic

The already crowded Turkish political agenda is about to generate a new problem: What will be the political future of Abdullah Gül, the president of the Turkish Republic, once his mandate is over in July 2014? The answer to this question is not straightforward at all since it has become clear that Mr. Gül will not retire from political life.
President Gül not ready to retire Indeed, he made it clear, in his much-remarked about speech during the traditional opening ceremony of Parliament on Oct. 1, that he “will continue to be at the service of the people.” Furthermore, Mr. Gül made important statements regarding domestic and foreign policy as well as economic issues, taking care to maintain his objectivity, even to present his criticism of some hot issues like the Gezi Park protest or Turkey's Syrian policy. I was particularly impressed by his assessments of economic problems, all the more since they are completely in line with my own views that I try to defend in this column. Admittedly, Mr. Gül has decided to be part of the decision-making process in the future, in one way or another. Before launching into some thoughts about the political future of Mr. Gül, I would like to reiterate what he said about the state of the Turkish economy and briefly make some comments. Let me quote the passage of the speech relating to the main economic challenges that the Turkish economy is facing: “This global economic climate may make it difficult for countries like Turkey who have low domestic savings levels to access the resources needed to finance growth. … A solution to the chronic low domestic savings problem became a priority. Our domestic savings ratio [as a proportion of the gross domestic product (GDP)], which was around 23 percent in the 1990s, started to fall in the following years but despite the measures that were taken, the ratio could only be increased to 15 percent recently. This low savings ratio constitutes one of the major obstacles to our efforts aiming for a sustainable growth performance. Hence, while on the one hand we have to increase the share of domestic savings in the financing of growth, on the other, we must absolutely increase the contribution of total factor productivity to growth. As I have always pointed out, the structural reforms that must be implemented in this respect are crucial in order to avoid our country falling into the middle-income trap.” I do not know how many times I have argued the same thing in my columns here. I recently wrote two articles about the quality of growth and domestic savings that were pointing out the necessity of increasing the domestic savings ratio as well as overall productivity if we want to avoid the middle-income trap. President Gül did not detail the policies to be followed in order to overcome the main economic problems. He contented himself to underlining the importance of quality education when productivity increases are considered under the conditions of global competitiveness. He also ruthlessly reminded everyone that Turkey is placed at the bottom of Organization for Economic Cooperation and Development (OECD) countries regarding the quality of its education. Thus, Mr. Gül did not choose an optimistic discourse. He did not make any reference to the unrealistic 2023 goals that constitute one of the preferred topics of Justice and Development Party (AK Party) ministers. He was realistic and, at the same time, he wanted, I think, to prove that he is mastering the problems of the Turkish economy. Now, let's come back to the difficult question: What role will Mr. Gül play in Turkish politics? The answer depends on many factors. Mr. Recep Tayyip Erdoğan, the prime minister, has confined himself in a way that will lead him inevitably to the presidency since it is now almost impossible to renounce the “three-term rule” which prevents deputies from being elected for the fourth mandate. The possibility of Mr. Erdoğan becoming prime minister for the fourth time is closed. But at the same time, the AK Party was not successful in changing the constitutional articles pertaining to the prerogatives of the president of the republic. Once moved to the Çankaya presidential palace, Mr. Erdoğan will no longer be a member of the AK Party and will have limited executive powers. Mr. Turgut Özal and Mr. Süleyman Demirel already experienced this ambiguous situation when they were elected as president. One can say that Mr. Erdoğan will have the advantage of being elected by direct popular vote, and will hence be more powerful. But this may not be enough to control the AK Party and be the head of the executive power, particularly should Mr. Gül decide to be the leader of the AK Party and, later, the prime minister.