Spotlight: Turkey faced by significant challenges in politics, economy, foreign affairs in 2015

The year 2015 has proven to be a difficult year for Turkey amid two national elections, the fallout from regional crises, and rising challenges in its economy.

The scheduled national elections on June 7 resulted in a hung parliament with no government formed, prompting the president to call for snap polls on Nov. 1.

Two elections in five months under a care-taker government forced Turkey to preoccupy itself by and large with domestic matters, when problems in the foreign policy and economy required an urgent attention.

"Perhaps this was the most challenging year for Turkey," Mehmet Seyfettin Erol, a professor of international relations at Ankara-based Gazi University, told Xinhua.

"Turkey's leaders faced monumental problems stemming from terrorism in both Kurdish and Islamic State (IS) militancy. Yet they needed to conduct election campaigns in the middle of spike in terror attacks," he recalled.

On June 5, four people were killed in two bomb blasts in the southeastern city of Diyarbakir, just two days before the June 7 parliamentary election. A suicide bomb was detonated in Suruc district of another southeastern province Sanliurfa bordering Syria on July 20, killing 34 pro-Kurdish activists. Both attacks were blamed on the IS.

The deadliest attack occurred on Oct. 10, when suspected IS militants staged a suicide attack on a crowd at the main train station in the capital Ankara, killing more than 100 people and injuring hundreds more.

In addition to the rising threat from the IS, Turkey also faced a surge in attacks by the outlawed Kurdish Workers' Party (PKK), which has been listed as a terror group by Turkey, the United States and the European Union.

The resumption of the PKK violence followed the breakdown of the settlement talks which the Turkish government started in late 2012 with the PKK. During the renewed clashes, some 200 members of the security forces have been killed, while three thousands PKK militants were eliminated in Turkey and northern Iraq.

Civilian casualties were also reported from the region that witnessed curfews and migrations as the military continued battles with the PKK hideouts in Kurdish cities and towns.

The deep polarization has stricken the political discourse throughout the year, with secular main opposition Republican People's Party accusing the Islamist-rooted ruling Justice and Development Party (AKP) of allowing transfer of radical elements from all over the world to Syria and Iraq.

FOREIGN POLICY CHALLENGES ON RISE

The most dramatic development of Turkey's foreign policy is the crisis between Ankara and Moscow after Turkey downed a Russian fighter jet near the Syrian border on Nov. 24. It resulted in a comprehensive shift of Russia's policy on Turkey, with Moscow announcing a number of economic sanctions against Turkey which may cost as much as 20 billion U.S. dollars in annual revenues.

The feud with Russia added more woes to Turkey's already strained ties with neighboring Syria and Iraq over the ongoing conflicts there, as well as the spillover of the refugee crisis that amounted to some 2.5 million people seeking shelter in Turkey.

Turkish President Recep Tayyip Erdogan said the government had spent nine billion dollars on refugees so far, but only received close to 500 million dollars from international donors.

Ankara does not consider Syrian President Bashar al-Assad's government as legitimate and supports the rebel factions that try to topple the regime in Damascus.

Worsening ties with Russia has pushed Turkey farther towards Europe and the United States, analysts believe.

"We suddenly rediscovered the EU as well as the U.S. after losing direction in our foreign policy due to the crisis with Russia," former ambassador Faruk Logoglu said.

According to Logoglu, Turkey's foreign policy is undergoing what he described as an "unhealthy" transformation following the worsening of ties with Russia.

Turkey's stalled bid for an EU membership was rejuvenated after the Turkey-EU summit on Nov. 29 led to a deal on containing the refugee problem and opening a new chapter in Turkey's accession talks.

Ankara has also allowed U.S., British, French and German warplanes to be deployed in Turkey for cross-border air strikes on IS targets inside Syria and Iraq.

"The recent events once again proved that NATO membership is the defining item of Turkish foreign policy character," Gokhan Bacik, a professor of international relations, said.

Stressing that Turkey is reluctantly turning towards the West, Bacik noted "Turkey is a NATO member country."

Turkey's image is perhaps worse today in the Arab world than when the Arabs revolted against Turkish rulers in World War I, according to Bacik.

Earlier in December, relations with Iraq turned sour over the reinforcement of Turkish troops deployed near Mosul in northern Iraq and other areas.

The new controversy over Turkish troops fed into the already fraying ties between Ankara and Baghdad over the former's cozying up with the Kurdistan Regional Government at the expense of Iraq's central government.

Iraq is not the only Arab country with which Ankara had issues lately. Problems in ties with Egypt's current leadership continue to remain as Ankara still refuses to deal with Egyptian President Abdel-Fattah al-Sisi who ousted former Islamist President Mohamed Morsi after popular protests. Diplomatic relations between the once close partners have been on thin ice since then.

Towards the end of 2015, hopes renewed on a rapprochement between Turkey and Israel, after secret talks resulted in an interim deal to normalize ties that were downgraded after the 2010 flotilla incident in which Israeli commandos raided the Turkish ship and killed ten people abroad.

Another hopeful development that looms large is the reunification of divided island Cyprus, after talks between the Turkish and Greek Cypriots, under UN auspices, received a new boost in mid-year for a viable and sustainable deal.

Cyprus was split into two in 1974, when the Turkish militarily intervened after a Greek Cypriot military junta removed a civilian government hoping to unite the island with Greece.

ECONOMIC TROUBLES REMAIN

Although the Turkish economy grew 3.4 percent year-on-year in the first nine months of 2015, beating expectation of a slower growth earlier this month, major challenges such as soaring unemployment and inflation rates and declining export revenues continue to trouble the Turkish government.

The unemployment rose to 10.3 percent in September, a six-month high, according to the government data in December. That figure translated to 3.1 million people without jobs. The youth unemployment rate also increased to 18.5 percent in the same period.

The annual inflation spiked to 8.1 percent in November, the latest available figure which is well above an official five percent target. The Turkish lira also lost its value significantly against the U.S. dollar.

Despite a stubbornly high inflation rate and the U.S. Federal Reserve's recent increase on interest rates, Turkey's central bank surprisingly left interest rates unchanged, prompting concerns over its independence from the government.

Another major worry for the Turkish economy is the impact from the expected 30 percent hike in minimum wages, a campaign pledge by the ruling AKP government ahead of the November polls.

Turkey's Central Bank Governor Erdem Basci said the bank estimated 1.5 percentage point impact on inflation from a planned increase in the minimum wages.

Seyfettin Gursel, an economist, said Turkey urgently needs structural reforms to bring its economy to the path of a potential growth estimated at around five percent per year.

Gursel said the Turkish economy suffers from two weaknesses: sluggish investment and the absence of labor productivity gains.

"In order to overcome these two weaknesses, productivity enhancing reforms are a must," he underlined.

The new AKP government has recently announced a major reform package to address the country's chronic economic problems, such as a rigid labor market, the income tax system and low domestic savings, but economists are not optimistic on the prospect.

"Given the track record of past AKP governments that had failed in implementing some 70 percent of reform pledges for the economy, there is nothing to be hopeful on this package either," Ibrahim Turkmen, an economist, told Xinhua.

Turkey's exports dropped by 10.5 percent in November on a monthly basis. The total export volume between January and November fell by 8.6 percent year-on-year to reach 131.9 billion U.S. dollars.

Strained political ties with Russia and Iraq, two major export destinations for Turkish goods, have already taken a toll on Turkey's export revenues. Endit