In November 2020, Turkish President Recep Tayyip Erdogan sacked his son-in-law, Finance Minister Berat Albayrak, in a humiliating manner that led to a political crisis within the ruling party and Erdogan's loss of his right arm therein. Erdogan offered his son-in-law as a scapegoat, declaring the failure of his economic policies. This matter will have negative repercussions for the cohesion of the ruling party after the process of liquidating the figures affiliated with Erdogan's son-in-law, and will lead to an increase in the influence of the nationalists within the party and in the government institutions.

Albayrak's Resignation Crisis

On 7 November 2020, President Erdogan abruptly dismissed the governor of the Turkish Central Bank (TCMB) Murat Uysal, without giving reasons, and appointed instead his economic adviser Naci Agbal. This step came without the knowledge of or in coordination with Finance Minister Berat Albayrak, President Erdogan’s son-in-law. It was later revealed that the dismissal decision came after a meeting held by Erdogan with Uysal and Naci Agbal in the presidential palace during which he reviewed the economic and financial situation. The figures provided by Uysal were contrary to those presented by Agbal, especially with regard to the TCMB's foreign exchange reserves.

Albayrak protested this step, which means declaring his failure to manage the economy and transferring part of his powers related to the TCMB to Agbal. Albayrak was quick to submit his resignation through his Instagram account after receiving information about President Erdogan's intention to dismiss him from his post, as Erdogan ordered the closure of Albayrak's Twitter account. After this resignation, Albayrak disappeared from the limelight to this day. No comment was made by Erdogan or the presidency on Albayrak's resignation for a full 72 hours, during which the news was hidden from the pro-Erdogan media, and even from the Qatari Al-Jazeera channel, until a statement was issued by the presidential palace affirming the “acceptance of Albayrak's request to be released from his post”. Afterwards, Erdogan went out to assert that Turkey "must take the bitter medicine in order to save the Turkish economy", indicating that he has finally allowed the TCMB to raise interest rates again in order to save the Turkish lira whose value collapsed to 8.5 liras per dollar.

This crisis indicates Erdogan's explicit admission of the failure of his economic policies. While Erdogan tried to hold his son-in-law Albayrak responsible for the state of the economy, all economic experts assert that the prime responsibility lies with Erdogan who used to reject any discussion about the need to raise the bank interest rate, and that Albayrak was implementing this policy, although he concealed from Erdogan the reality of the financial situation in order not to appear as if he had failed to reconcile Erdogan's desire with saving the Turkish economy.

This crisis will also have a dangerous political impact on the ruling Justice and Development Party (AKP), especially since Erdogan was preparing to "bequeath Albayrak the leadership of the party after him", if he decides to give up the party leadership and settle for the position of President of the Republic. Albayrak had been engaged in a political competition and conflict with his opponent in the party Interior Minister Suleyman Soylu, who is affiliated with the nationalist movement, in order to control the party’s wings and state institutions. Albayrak was secretly handling the judiciary, paralysing Justice Minister Abdulhamit Gul, and also interfering in appointments of the security services and party leaders. Therefore, Albayrak’s exit from the picture amounts to an important rise for Interior Minister Soylu, whom Erdogan does not trust, considering him as someone imposed on him by his nationalist ally Devlet Bahceli.

Despite the current alliance between Erdogan and Bahceli, both of them do not trust each other. They know that their alliance is built on interests, even as each side seeks to acquire as much as possible of the state apparatus. While Erdogan appoints Islamists and followers of religious groups in the state, judiciary and security establishments to ensure their loyalty, the nationalists compete with him through Minister Soylu for those appointments. That is why, President Erdogan was quick to appoint a number of nationalists in his party, who were loyal to him and not to the nationalist party, in important and sensitive positions, as advisers to him, including the former Minister of the Interior Efkan Ala, and Lutfi Elvan as Minister of Finance. These two were ministers in the previous government of Ahmet Davutoglu. They are also close to Davutoglu. News was leaked from the Republican Palace that Erdogan thus prevented them from defecting and joining Davutoglu's Gelecek (Future) Party. Ahmet Davutoglu confirmed those leaks in a later statement, saying, "Erdogan knows with whom we communicate in his party and is aware of the danger he faces".

Accordingly, Erdogan must now rearrange the internal situation of his party after Albayrak’s departure, as he cannot trust the figures appointed by Albayrak. Indeed, the dismissals began to pursue a number of Albayrak's figures in many state institutions, such as the Stock Exchange and the TCMB. After this crisis, it is unlikely that Albayrak would return to any political position in the foreseeable future. Indeed, the process of rearranging the internal affairs is expected to extend to Serhat Albayrak, brother of Berat Albayrak, who is currently responsible for the strongest media arm of the ruling party.

The timing of Albayrak's dismissal crisis coincided with the victory of the US Democratic presidential candidate Biden. This amounts to Erdogan's loss of the support of President Trump and the possibility of the activation by the new US administration of the sanctions whose implementation was hindered by Trump due to Turkey's purchase of the S-400 missiles. Among the proposed sanctions of the Countering America's Adversaries Through Sanctions Act (CAATSA) is the "investigation of the savings and property of Erdogan and his family around the world". Furthermore, the case of the Turkish Halk Bank, which is accused of circumventing US sanctions on Tehran, will be reconsidered in New York in March 2021. That case affects Erdogan and a number of his old ministers, in addition to Berat Albayrak himself. All those possibilities have most likely prompted Erdogan to reconsider his calculations and change his political orientations in order to cope with the new US policy of President-elect Joe Biden, which will focus on human rights, freedoms and democracy.

The crisis of Albayrak’s dismissal came at a time of escalation in the silent dispute between Erdogan and his nationalist ally, after the nationalists increased control over the security and judiciary apparatus in a way that has come to threaten Erdogan and his authority over those two establishments. It also coincided with the nationalists' demand to control the intelligence services by demanding the removal of Hakan Fidan and the appointment of another person from the Nationalist Party. Since that crisis, the pro-Erdogan newspapers began – unusually – to ignore the news and pictures of the nationalist ally Devlet Bahceli in their publications. Indeed, Erdogan refused to travel to Northern Cyprus with his nationalist ally in one plane. AKP Members of Parliament (MPs) began to speak louder about the "danger" of the continuing alliance with the Nationalist Movement Party (MHP), which has come to impose its policies on the government and establish its presence in the state apparatus at the expense of the ruling party.

Erdogan's crisis with the nationalist ally and the possibility of changing domestic and foreign policies

After the crisis of Albayrak’s dismissal, President Erdogan has tried to appear as someone who wanted to open a new page in his policies and convert to democracy again by promising radical economic and democratic reforms, as he put it. In mid-November 2020, Erdogan promised to initiate major and fundamental reforms at the economic and judicial levels. Addressing the judges in Turkey, he said, “You have to base your judgements on your conscience and reject any dictates directed to you in the cases you look into”. He was followed by the Minister of Justice Abdulhamit Gul who confirmed the start of work on a constitutional and legal amendment in order to “ensure the integrity of the judiciary”. The minister held the judges responsible for all previous judicial excesses and violations, saying that judges who refused to obey the rulings of the Constitutional Court will be held accountable, given that all those cases were related to Kurdish political opponents who were ordered to be put in prison by Erdogan himself, mainly the Kurdish leader Selahattin Demirtas, whose release was ordered by the Constitutional Court, although the Criminal Court refused to implement this ruling in violation of the constitution, even as no one acted to change this situation before.

The Turkish opposition parties read those surprising statements by Erdogan as a deliberate intention to get rid of his nationalist partner who has become a threat to him, and to carry out democratic reforms, albeit limited, in order to woo the new US administration. Thus, the leaders of the opposition parties rushed to hold bilateral meetings in order to come up with a common view on the reforms that need to be undertaken, and to coordinate positions among the parties in preparation for Erdogan's search for a new partner in the government in place of the Nationalist Party. In this context, the leader of the Future Party Ahmet Davutoglu held meetings with the leaders of the opposition Ataturkist Republican People's Party (CHP) and the nationalist Good (Iyi) Party. He requested a meeting with Bahceli in order to present to him a “map of the exit from the current situation in cooperation with the opposition”. However, Bahceli's office director responded to Davutoglu, saying that "Bahceli refuses to discuss any proposal related to changing the presidential system of government and returning to the parliamentary system of government, and that Bahceli may accept to meet him in case he has proposals to amend the current presidential system only".

It seems clear through the leaks and statements of the Turkish opposition leaders that they see that Erdogan is currently in a great dilemma looking for a way out, as the economy is facing a major crisis that can only be solved through resorting to the International Monetary Fund (IMF). Besides, Turkey is on the threshold of a major crisis with the new US administration due to Erdogan's domestic and foreign policies of a nationalistic character. Ahmet Davutoglu is the person most aware of this, given that he has an excellent relationship with members of the new US administration due to his previous work with them during his tenure as the Turkish Foreign Minister during the era of former President Barack Obama. The opposition is aware that Erdogan feels that he has become surrounded by the nationalists whom he does not trust and who do not trust him, and that the popularity of Erdogan and his party would not allow him to enter new elections without a strong political ally in place of the nationalists. Therefore, the opposition believes that the opportunity is now ripe to present to Erdogan an offer to get rid of this impasse in exchange for the return to the parliamentary system of government. This proposal is based on introducing a constitutional amendment whereby Turkey would return to the parliamentary system of government, and the formation of a national unity government from all parties except the Nationalist Party. This government would undertake all the political and economic reforms required in order to restore Turkey's path to democracy, expand freedoms, and restore good relations with the neighborhood and the West, that is return Turkey to the policies of 2006.

However, the opposition is still divided over President Erdogan’s role in this future scenario, between Davutoglu and the leader of the Good Party Meral Aksener, who do not object to the stay of President Erdogan in the position of president, albeit with limited powers, on the one hand, and the CHP and its leader Kılıcdarolu, who believes that Erdogan has started to lose his credibility, that time is not in Erdogan’s favour, and that Erdogan has to lose the next elections in order to be forced to give up power, on the other hand. Meanwhile, President Erdogan perceives this position of the opposition, and perhaps would try to negotiate from a position of power to obtain political support from the opposition in exchange for getting rid of his nationalist partner, carry out limited political and economic reforms, and remain in power as a president with wide powers in accordance with the current presidential system, with the distribution of some ministerial tasks to the opposition.

Conclusion and expectations

The crisis of the resignation of the Turkish Finance Minister Berat Albayrak came in conjunction with the escalation of the silent dispute between President Erdogan and his nationalist ally. In the light of the recent developments, Erdogan is expected to start working on arranging the internal affairs of his party first, weakening the control of the nationalists within the state apparatus, and playing for time in order to pressure the opposition to get the best offer from them before he abandons the nationalists – if he does abandon them – and changing Turkey's domestic and foreign policies. He also awaits the signals that will come from Washington and the extent of the US ally’s desire that Erdogan proceed along this road in exchange for closing the file of being accused of taking part in circumventing the US sanctions imposed on Iran.

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