With sweeping powers, Erdogan looks to put Turkey on path of fast growth

Turkey's Tayyip Erdogan will fulfil a long-held ambition on Monday when he is sworn in as president with sweeping new powers over a country he has dominated and reshaped during his 15-year rule.

Launching the executive presidency which he campaigned hard to secure, Erdogan will also name a streamlined cabinet he says will push for growth to make Turkey one of the world's biggest economies. Erdogan narrowly won a referendum last year to replace Turkey's parliamentary democracy with a system featuring an all-powerful presidency, and followed that with a hard-fought election victory last month to the newly strengthened post. He says the changes, the biggest overhaul of governance since the modern Turkish republic was founded from the ruins of the Ottoman Empire almost a century ago, are needed to drive economic growth and guarantee security.

His supporters see them as just reward for a leader who has put Islamist values at the core of public life, championed the pious working classes and built airports, hospitals and schools. Opponents say the new powers mark a lurch to authoritarianism, accusing Erdogan of eroding the secular institutions set up by modern Turkey's founder, Mustafa Kemal Ataturk, and driving it further from Western values on democracy and free speech. "Turkey is entering a new era with the presidential oath ceremony on Monday," Erdogan told his ruling AK Party at the weekend. "With the power granted to us by the new presidential system, we will get quicker and stronger results."

On the eve of Monday's inauguration authorities dismissed more than 18,000 state employees - most of them from the police and army - in what the government said would be the final decree under emergency rule imposed following a failed 2016 coup. More than 150,000 state employees have lost their jobs in the crackdown that followed the coup attempt, and the interior minister said in April some 77,000 people have been formally charged and kept in jail during their trials.

ECONOMIC CONTROL

Erdogan will take the oath of office in parliament at 4 pm (1300 GMT), before attending a ceremony two hours later at the huge presidential palace he has constructed in the capital.  Venezuelan President Nicolas Maduro, Hungarian Prime Minister Viktor Orban and former Italian Prime Minister Silvio Berlusconi were due to attend the ceremony. Erdgoan has said he will announce the cabinet on Monday night, promising to make appointments from outside parliament and to slim down his ministerial team to 16 from more than 20.

The post of prime minister will be scrapped. The president will be able to select his own cabinet, regulate ministries and remove civil servants, all without parliamentary approval. Investors were waiting to see whether cabinet appointees would include individuals seen as market-friendly, and particularly whether Mehmet Simsek, currently deputy prime minister, would continue to oversee the economy. "For the cabinet appointments in the past several years, the most important issue has been the presence of the current deputy prime minister, Mehmet Simsek," said Inan Demir, a senior economist at Nomura International. 

The lira, which is down some 16 percent so far this year and has been battered by concern about Erdogan's drive for lower interest rates, firmed to 4.5160 against the dollar by 1016 GMT, its highest since mid-June. Erdogan has described high interest rates as "the mother and father of all evil", and said in May he would expect to wield greater economic control after the election.  "We will take our country much further by solving structural problems of our economy," he said on Saturday, referring to high interest rates, inflation and the current account deficit. Inflation surged last month above 15 percent, its highest level in more than a decade, despite interest rate hikes of 500 basis points by the central bank since April.

TIGHTENING GRIP

Since taking office in 2003, first as prime minister and later as president, Erdogan has dominated Turkey, tightening his grip over the country of 81 million people as he tamed rival power centres including the military, which toppled some previous governments. Under his leadership Ankara started accession talks with the European Union, which stalled amid EU criticism of Turkey's human rights. Ties with the United States and other NATO partners also frayed, but Turkey remains crucial for any hope of stability in Syria and Iraq and curbing refugee flows to Europe. 

A powerful campaigner, he is Turkey's most successful and divisive leader in recent history. Erdogan has prevailed in a dozen local, parliamentary and presidential elections.  After his election victory two weeks ago, Erdogan said he would spare no effort to spur economic growth. "There is no stopping for us until we bring Turkey -- which we saved from plotters, coupists and political and economic hitmen, street gangs and terrorist organisations -- to among the top 10 economies in the world," he said.