Turkish Deputy PM Babacan to maintain oversight of economy - for now

Turkish Deputy Prime Minister Ali Babacan will retain overall responsibility for the economy in the new government, senior officials told Reuters late on Aug. 30, a move likely to ease concerns of a turf war within the Cabinet.

Babacan, and more recently Finance Minister Mehmet Şimşek, have been part of a well-respected economics team that has helped steer Turkey through a decade of growth and stability.

The announcement of new Prime Minister Ahmet Davutoğlu's cabinet on Aug. 29saw both men retain their posts. But the appointment of Numan Kurtulmuş, head of economic affairs in the ruling Justice and Development Party (AKP), as another Deputy Prime Minister, had unnerved markets already unsettled by signs of a slowdown and growing fears over the country's fiscal policy becoming increasingly politicised.

"Babacan will be in charge of economic affairs. Nothing has been changed on the economy side for the government," one senior official in the prime ministry said, adding that a formal announcement would be made on Sept. 1.
 
"I know Numan Kurtulmuş was in charge of economic affairs in the party. But he will be responsible for some other political issues. The economics team will work as before," the official said.

A second official in the prime ministry confirmed the decision. President Recep Tayyip Erdoğan, inaugurated on Aug. 28, has made it clear he will go beyond the largely ceremonial role heads of state have performed hitherto, and investors will be watching to see how the new balance of power settles in the coming months and the general elections of 2015.

On Aug. 30, Erdoğan's office also confirmed that Yiğit Bulut, an influential but divisive aide who last year accused foreign powers...