Turkey’s Erdogan faces array of urgent challenges

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Turkey's re-elected Prime Minister Tayyip Erdogan faces hefty challenges as he starts his third term: Syria, Israel, Kurds, stalled EU membership talks, an overheating economy at home and writing a new constitution.
Erdogan, who has transformed Turkey into one of the world's fastest-growing economies and piloted assertive foreign policy, won Sunday's parliamentary elections with nearly 50% of the vote.
Here are some the most immediate foreign policy and domestic challenges he faces.

SYRIAN UNREST

Under its "zero problems with neighbours" policy, Turkey has made a huge effort to improve political and economic ties with Middle Eastern neighbours. But, having cultivated good relations with autocratic leaders, Turkey's diplomatic skills are being put to the test by the "Arab Spring" uprisings, as it supports people's demands for greater democracy in the region.
The most pressing crisis is in neighbouring Syria. Thousands of refugees have fled to Turkey to escape a bloody crackdown by President Bashar al-Assad. Having embraced Assad as a friend and urged him to make reforms, Erdogan has become increasingly critical of the Syrian government's use of force against its own people.
It is unclear what leverage Ankara has, but Erdogan has said that after Sunday's vote Ankara will talk to Assad in a "very different manner".
Turks are prepared for a further possible mass influx of Syrian refugees along the 900-kilometre border. Turkey said on Monday 6,817 Syrians had crossed the border.

ISRAEL AND GAZA-BOUND FLOTILLAS

Ties between Turkey and Israel were strained after Israeli marines stormed a Gaza-bound Turkish aid ship, killing nine Turkish activists in May 2010.
Turkey has said it cannot stop pro-Palestinian Turkish activists from sending a fresh convoy to Gaza planned for late June. Israel has warned future flotillas will be intercepted for security reasons, setting the stage for possible confrontation.
Foreign Minister Ahmet Davutoglu has said the onus is on Israel to apologise for the killings in order to reestablish ties, seen as supportive of U.S. interests in the region.
Erdogan's fiery criticism of Israeli policies towards Palestinians has turned him into a hero in the "Arab street" and won applause home. Analysts do not expect Erdogan to change his attitude towards Israel.

EU MEMBERSHIP

Analysts say Erdogan needs to focus on reviving Turkey's EU bid, which remains stalled. Erdogan announced last week he planned to set up a new ministry for relations with the EU as part of a ministerial shake-up. But support for EU membership among Turks is declining and many question why dynamic Turkey would want to enter a union plagued by debt and slow growth.
Turkey could break a deadlock in negotiations by opening its ports and airports to traffic from EU member Cyprus. With the election out of the way, a move that dices with nationalist sentiments would be less risky and could be worth taking.
It would force the EU to unfreeze several remaining chapters, or subject areas, for negotiation.

NEW CONSTITUTION

Erdogan failed to win enough seats to call a referendum on a planned new constitution, but this is unlikely to deter him, given his AK party polled nearly 50% of the vote — its highest mark since it first came to power in 2002.
Erdogan has said he will seek consensus but it remains to be seen how he will approach the reform. Erdogan may still seek to win defectors from other parties to bring his 326 majority above the 330 seats required. If he tries to push his way through, as he has done in the past, political tensions will rise.

KURDS

There are compelling reasons for Erdogan to have another go at resolving the Kurdish problem to quell a decades-long separatist insurgency. Electoral gains made by Kurdish independents were a message to Erdogan to engage more fully, after his failure to follow through on his initiative to grant Kurds more cultural rights two years ago.
He may not want to be seen to be bowing to pressure from Abdullah Ocalan, the jailed leader of militant Kurdistan Workers Party (PKK), who threatened a "big war" if the government failed to begin serious talks days after the election.

OVERHEATING ECONOMY

Having built a reputation for ending Turkey's financial meltdowns of the past and making it one of the world's fastest growing emerging markets, the government needs to make sure it avoids any pitfalls.
Analysts are calling for the government to take stronger measures to curb growth which risks reigniting inflation.
Specifically, they want the central bank to adopt a more orthodox strategy by raising interest rates, and the government to pitch in with fiscal tightening.