Erdogan makes himself ‘czar of the economy’
Turkish President Recep Tayyip Erdogan’s decision to take the helm of Turkey’s sovereign wealth fund compounds misgivings over an institution that holds the country’s key public assets, but is already mired in controversy for lack of transparency and public supervision.
Faced with economic turmoil fueled by the meltdown of the Turkish lira, President Recep Tayyip Erdogan has been issuing threatening messages against price hikes and capital flights. On Sept. 12, he took a critical step that effectively made him the czar of the economy. Erdogan appointed himself the head of the Turkey Wealth Fund (TVF), which holds $200 billion public assets, while naming as deputy his son-in-law Berat Albayrak, who is also the treasury and finance minister. By taking the helm of an institution that controls strategic public companies, Erdogan is assuming an extraordinary authority over the economy.
Created hastily in August 2016 under a state of emergency, the TVF has stakes in public giants such as Ziraat Bank, pipeline operator BOTAS, oil company TPAO, the national postal service, the Istanbul stock exchange, satellite communications company TURKSAT, the national lottery, Turkish Airlines, Halkbank and Turkish Telekom.
Sovereign funds are generally created by countries with budget surpluses to set aside funds for investment to benefit their citizens and economies. Some of the world’s best-known sovereign funds include those of oil-rich nations such as Norway and Gulf countries. Turkey’s case is rather out of spec, for it boasts neither budget surpluses nor energy revenues.
Since the fund was already under government control, why did Erdogan feel the urge to take the reins into his own hands?
