Turkey's government said on 31 December it was fending off a "mini coup attempt" by elements in the police and judiciary who served the interests of foreign and domestic forces bent on humbling the country.
A NATO member with hopes of EU membership, Turkey is locked in a long power struggle between the AK Party, which has its roots in political Islam, and conservative, nationalist secularists, whose bastions remain the military and judiciary.
Known as 'Kemalists', the Turkish military are considered guardians of Kemal Ataturk's secular legacy. After World War I, Ataturk sought to transform the ruins of the Ottoman empire into a democratic, secular nation state. In past decades, the military has toppled several governments.
In 2008 the ruling AKP curtailed the army's power as part of what was presented as efforts to prepare the country for EU accession. In response, the military launched an unsuccessful bid to ban AKP.
A wave of arrests of suspected members of 'Ergenekon', a mysterious organisation close to the secularist military establishment, brought new tension to Turkey. In the recent past, the EU has taken the side of AKP against those accused of "being members of the Ergenekon criminal organisation".
A sit-in against plans to demolish a park in Istanbul sparked the fiercest anti-AKP in recent years in Turkey, and the heavy-handed reaction by the authorities raised concerns in the West.
Deputy Prime Minister Ali Babacan said the ruling AK Party had in the past survived military coup plots and attempts in the courts to outlaw it. It would not now yield to a corruption investigation that he said targeted the government but was already damaging the national economy.
"These latest formations in the judiciary and the police, we can't call it a coup, but a mini coup attempt. This is what interests foreign investors," he told broadcaster CNBC-e, echoing suggestions by Prime Minister Recep Tayyip Erdoğan of a foreign interest in the crisis.
"Maybe the clearest indicator of this was the fall in share prices," added Babacan, who is in charge of the economy.
The market value of Turkish listed companies had fallen $49 billion (€35.5 billion) by Monday's market close, he said. The main share index was down 1% on Tuesday.
Erdoğan has, without naming it, accused a movement led by Turkish cleric Fethullah Gülen of creating a "state within a state", using influence in the police and judiciary in a campaign to discredit the government.
The "Hizmet" (Service) movement controls a vast global network of schools and businesses. Tensions have grown between the two former allies over elements of foreign and domestic policy and moves to close his private schools in Turkey.
The graft inquiry became public on 17 December with a series of raids and detentions of senior businessmen close to Erdogan and of the sons of three ministers. Since then, the media hostile to Erdoğan has brimmed with tales of police raiding offices or homes and seizing caches of dollar bills.
President Abdullah Gül, seen as unifying figure who has largely stayed out of the furore, made an appeal for unity in a New Year's message, stressing the importance of a clear separation of powers.
"It is the duty of all of us to avoid attitudes that damage the fact and perception of an independent and impartial judiciary," he said in the message on the presidency website.
Erdoğan's supporters argue the graft accusations have so far lacked any substance and were driven by political ambitions.
"We as the government are on the job," Babacan said. "We created this political and economic stability with our own strength. We will not easily allow someone to come and take it away. However many efforts there were until now trying to shake political stability, we overcame them all."
Army out of politics
Erdoğan has overseen strong economic growth and a period of political stability unmatched in modern times since his AK Party was first elected in 2002.
The current corruption crisis is not the first critical moment for Erdoğan, who created the party with the name AK - a word that in Turkish suggests purity and resistance to the corruption that had tainted older established parties.
Hundreds of senior army officers have been jailed on accusations of plotting to overthrow Erdoğan, who has succeeded in banishing from politics a military that had intervened to topple four governments in the second half of the 20th century.
Hardliners in the judiciary tried in 2008 to impose a ban on the AK Party, a coalition of conservative religious elements, centre-right figures and nationalists that was accused of endangering the country's secular order (see background).
As Babacan was speaking, news emerged of a further resignation from the AK Party. A total of seven MPs have resigned from the AKP since the end of November, five since the 17 December police raids.
There is, however, no sign of any large-scale abandonment of the party which dominates Turkish politics. Erdoğan, playing on his still unrivalled popularity, could even call early elections next year to shore up his position.
Erdoğan has responded to the corruption scandal with the purging of some 70 police investigators and blocked a second wave of investigations. Those targeted some of Erdogan's most ambitious infrastructure projects, including a third Bosphorus bridge and a canal allowing passage from the Black Sea to the Mediterranean, easing traffic on the Istanbul Strait.
Erdoğan, whose popularity held up through a summer of protests against what critics call an increasingly authoritarian style of government, has broadened Turkish influence in the Middle East and Africa with a vigorous business drive, led often by construction projects.
Certainly, this has been to some extent to the detriment of relations with the United States and European Union.
"There is a very significant and broad mass uncomfortable with the position which Turkey has reached in the last 11 years, the advances it has secured, the power it has created in the region, its resonance in the world," Babacan said.
Enlargement Commissioner Štefan Füle said on 27 December in a written statement that he has followed developments in Turkey since 17 December with growing concern.
“The change introduced to the judicial police regulation has undermined the independence of the judiciary and its capacity to act,” said Füle.
“I urge Turkey, as a candidate country committed to the political criteria of accession, including the application of the rule of law, to take all the necessary measures to ensure that allegations of wrongdoing are addressed without discrimination or preference in a transparent and impartial manner,” he added.
The Minister for EU Affairs and Chief Negotiator Egemen Bağış has been sacked over the corruption scandal. Mevlüt Çavuşoğlu, the newly appointed Minister for EU Affairs and Chief Negotiator stated on 29 December:
“Turkey is sincerely committed to its obligations arising from the EU acquis and the principle of the rule of law. I invite our European friends to avoid bias and maintain equanimity when commenting on domestic developments in Turkey which also have political dimensions. There should be no doubts that Turkey will overcome this challenging process through the guidance of democracy and the fundamental principles of law. By this occasion, I would like to reiterate the importance of opening Chapters 23 and 24 [Justice and Home Affairs] to negotiations without delay, as indicated in the European Commission’s 2013 Progress Report on Turkey.
Commenting on the scandal of widespread corruption in Turkey, MEP Ria Oomen-Ruijten, European Parliament Rapporteur on the country (EPP, the Netherlands), stated that recent developments in Turkey have raised concern in the EU have raised concerns with regards to the impartiality of investigations and the separation of powers in Turkey.
"I call on the Turkish government to refrain from interfering in judicial proceedings and to make sure regulations are in line with the principles of the independence of the judiciary, the separation of powers as well as the relevant articles of the Constitution," Oomen-Ruijten said.
- 20 March 2014: Local elections to be held in Turkey;
- August 2014: Turkey will hold for the first time direct presidential elections;
- June 2015: General elections to be held, but these may take place earlier in 2014, depending on political circumstances.