Turkish PM retains finance minister in new cabinet

(Adds quotes, market reaction, byline)

By Pinar Aydinli

ANKARA, July 6 (Reuters) Turkish Prime Minister Tayyip Erdogan unveiled a new cabinet on Wednesday, retaining Finance Minister Mehmet Simsek to manage the overheating economy canada goose uk black friday and creating a new ministry to press a uk canada goose outlet flagging EU membership bid.

coming four years will be a high performance four years, and the first year will be an intensive working period, Erdogan told a news conference announcing his team.

Erdogan, whose AK Party won an unprecedented third term in office canadian goose jacket in an election last month, canada goose outlet Canada Goose Outlet has said he aims to replace a constitution that was drafted after a coup in 1980.

Markets hope, however, Canada Goose Coats On Sale that the government will prioritise canada goose coats the need to canada goose uk outlet cool an economy that surged 11 percent in the first quarter Canada Goose jacketstock Jackets of 2011, and could rack up a current account deficit of up to 10 percent of GDP this year.

While Simsek keeps his post Zafer Caglayan, former trade minister, was named buy canada goose jacket new economy minister. In the previous government, Deputy Prime Minister Ali Babacan was responsible for the economy.

Babacan has been retained as one of four deputy prime ministers, but Erdogan did not specify what Babacan duties would be in the new cabinet.

Erdogan will present canada goose uk shop his government programme to parliament on Friday for a vote of confidence.

Turkish financial markets, more preoccupied with eurozone debt fears after the downgrading of freshly bailed out Portugal credit rating, were mostly unmoved by new cabinet.

economy team doesn include a surprise, said Tufan Comert, a strategist at Garanti Securities. neutral for the market.

Ahmet Davutoglu, the architect of NATO member Turkey assertive foreign policy and closer ties to Middle East countries including Iran, stays as foreign minister.

Liberal on economic issues and socially conservative with Islamist roots, AK swept to power promising reforms in 2002, pushing bold changes that challenged the secularist military and judiciary canada goose and expanding some rights for minority Kurds.

Critics say there was a canada goose black friday sale dearth of reforms in recent years as AK grew Canada Goose sale used to power and some accuse Erdogan of restricting cowing freedoms and uk canada goose of being intolerant of dissent.

FISCAL TIGHTENING Under Erdogan, Turkey has been transformed buy canada goose jacket cheap from serial basket case to one of the world fastest growing economies, but there are worries that it could be set for a hard landing unless the new government tightens fiscal and monetary policy fast.

For all the concern among analysts Canada Goose online over the size Canada Goose Parka of cheap canada goose uk the current account deficit, Erdogan said it was not a worry and would start falling in the fourth quarter.

Analysts also see a risk of inflation gathering pace, but the central bank is resisting pressure to change an unorthodox policy, introduced last December, which relies on lower canada goose coats on sale interest rates to deter portfolio inflows and higher reserve ratio requirements for banks, to dampen credit growth.

In an appointment that could breathe canada goose clearance new momentum into Turkey aspirations to join the cheap Canada Goose European Union, Canada Goose Online Egemen Bagis, Turkey chief canada goose store negotiator for EU membership, was appointed head of the newly created European Union ministry.

Erdogan, whose AK won 49.9 percent of the vote on June 12, has pledged to reach out to the opposition to write a new constitution. There is speculation that Erdogan wants to move canada goose clearance sale Turkey toward a more presidential system of government, with the ultimate canada goose factory sale aim of becoming president himself.

But his calls for consensus got off to a bad start after nearly a third of elected deputies, making up the bulk of the opposition, refused to take their oath at the opening of the mew parliament last week to protest against bans on elected candidates. (Writing by Ibon Villelabeitia; Editing by Simon Cameron Moore and Jon Hemming).