Turkey's New Era: Turkish President Erdogan takes oath of office

Turkish President Tayyip Erdogan announces his new cabinet at the Presidential Palace in Ankara, Turkey July 9, 2018.

Erdogan narrowly won a referendum previous 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. The Turkish lira dropped three percent on the news, but rebounded slightly on Tuesday.

Berat Albayrak, the husband of Erdogan's elder daughter Esra, was on Monday named by the president as treasury and finance minister as part of a cabinet reshuffle for his new term.

The lira currency, which has been battered this year by concerns about President Tayyip Erdogan's drive for greater control over monetary policy, declined after the changes were published.

The new system was agreed in a bitterly fought 2017 referendum, but the changes have been vehemently denounced by the opposition.

"We, as Turkey and as the Turkish people, are making a new start here today", he told the dignitaries and thousands of guests.

Erdogan will this week immediately turn to foreign policy, visiting northern Cyprus and Azerbaijan, followed by more challenging encounters at a North Atlantic Treaty Organisation summit in Brussels where he will meet US President Donald Trump and other leaders. The term of duty for the top army general is four years.

Mr Erdogan has largely ruled by fiat since 2016, when he imposed a state of emergency on the country in response to a failed coup attempt against him.

The appointment of Albayrak, the husband of Erdogan's elder daughter Esra and formerly energy minister, came as a surprise, with no place for Mehmet Simsek, the former deputy prime minister for the economy trusted by markets.

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. Marc Pierini, a former European Union ambassador to Turkey and a visiting scholar at Carnegie Europe, said Erdogan's new powers would effectively make him a "super-executive president".

A powerful campaigner, he is Turkey's most successful and divisive leader in recent history. "In other words, Turkey will be an institutionalized autocracy", former EU Ambassador to Turkey Marc Pierini said.

State news agency Anadolu said Erdogan's inauguration celebration was attended by Venezuelan President Nicolas Maduro, Russian Prime Minister Dmitry Medvedev and Sudanese President Omar Hassan al-Bashir, wanted for war crimes by the International Criminal Court.

"The latest vast round of purges is a further confirmation that there won't be any meaningful normalization of Turkish politics for the foreseeable future", according to Teneo Intelligence Co-President Wolfango Piccoli.

Erdogan said he would publicize his cabinet picks later on Monday.

The markets were keeping a close eye on the finance ministry, keen to see a steady hand at the helm in a fast-growing economy dogged by double-digit inflation and a widening current account deficit.

The five-year term served as a sort of "shield" for the central bank, helping to ensure its independence from politicians, said Ugur Gurses, a former central banker.

He won last month's election with 52.6 per cent of the vote, ushered in the executive presidency that ends parliamentary governance and boosts the powers of the formerly ceremonial presidency.

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