Turkish government denies resignation rumors about deputy PM Babacan

Turkish government denies resignation rumors about deputy PM Babacan

Turkish government denies resignation rumors about deputy PM Babacan

Deputy Prime Minister Ali Babacan (L) and Prime Minister Ahmet Davutoğlu. AA Photo

The timing of a lengthy meeting between Prime Minister Ahmet Davutoğlu and Deputy Prime Minister Ali Babacan late Feb. 25 has led to speculation suggesting Babacan resigned from his post after President Recep Tayyip Erdoğan continued his criticism of the Central Bank.

Yet, Energy Minister Taner Yıldız ruled out such move.

“Such thing is out of the question,” Yıldız said, on the early morning of Feb. 26 during ongoing debates on the government-led homeland security bill at the General Assembly of parliament.

Yıldız’s brief explanation came after a question about the claims stemming from social media posed by main opposition Republican People’s Party (CHP) Ankara deputy Bülent Kuşoğlu.

On the evening of Feb. 25, Davutoğlu held a meeting with Babacan, which lasted more than two hours. While reporting on the meeting, state-run Anadolu Agency said the meeting was previously scheduled. The two discussed Davutoğlu’s upcoming visit to New York, where he is expected to meet financial and investment circles as part of the second leg of an investors’ conference that was held in London in January, as well as discuss details on some other issues, the agency said, citing anonymous sources from the prime minister’s office.

In a public speech delivered earlier on Feb. 25, Erdoğan stepped up his criticism on the Central Bank and its governor Erdem Başçı, questioning whether the Bank was under external influence and warning that the good character of its governor was no defense against poor policy.

In early February, Babacan stated that the duties of the Central Bank are defined in the law quite clearly and the government trusts in the Bank’s competent team.

In remarks delivered on Feb. 9 at the G-20 meetings in Istanbul amid ongoing tension between Erdoğan and the Central Bank’s administration over the Bank’s interest rate policies, Babacan said he believed the Bank’s team “makes the right decisions at the right times.”

“We believe the team makes the right decisions at the right times,” he said at a joint press meeting in Istanbul with OECD Secretary General Angel Gurria. “There could be more interaction and communication between central banks and governments, but there is no problem with it.”