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. Last Updated: 07/27/2016

No Surprises in New Turkish Cabinet

ANKARA, Turkey -- Turkey's Justice and Development Party, or AKP, took office on Monday after the president approved a Cabinet list with little to surprise nervous financial markets and Turkey's Western allies.

The AKP won a landslide victory in Nov. 3 polls. The government will have to work fast to win the confidence of financial markets and foreign allies as it works to implement the country's $16 billion International Monetary Fund rescue pact and bids to join the European Union.

Prime Minister Abdullah Gul said Ali Babacan, a 35-year-old Western-educated former financial consultant, would be economy minister in a move likely to reassure markets.

Yasar Yakis, a career diplomat who has been accompanying AKP leader Tayyip Erdogan on trips to Rome, Cyprus and Greece in the past week to drum up support for Turkey's EU bid, will be foreign minister.

Tayyip Erdogan, leader of the AKP, cannot be prime minister or a Cabinet minister due to a previous conviction for inciting religious hatred.

Defense minister, whose influence is balanced by that of Turkey's powerful generals, will be Vecdi Gonul, a former Interior Ministry undersecretary known to be a friend of President Ahmet Necdet Sezer.

Observers say the AKP is unlikely to change NATO member Turkey's policy on Iraq, which faces the threat of war from the United States. Turkey is expected to provide support to Washington if the United States does go to war.

Turkey's IMF economic rescue program is aimed at overcoming the damage caused by the country's financial crisis in 2001 and markets have been eagerly awaiting the naming of the economy minister, who will be crucial to market confidence.

Babacan, who at 35 is one of the youngest AKP deputies, is untried in government. He has been in the private sector since earning an MBA in the early 1990s in the United States, where he also worked as a financial consultant.

"It's a positive development. He's one of the masterminds of explaining the party's economic program," said Hakan Avci, strategist at Global Securities.

Observers say Babacan is pro-Western, embracing Turkey's European Union ambitions, and has said the AKP government would stick by the basic principles of Turkey's IMF pact.

The government takes office from the moment the president approves the list, though it then needs to win a confidence vote, which should be a formality given AKP's large majority in parliament.

Abdulkadir Aksu, a former police official from the southeast, will be interior minister. He will have a key role in pushing through key human rights reforms needed to meet EU membership criteria. Gul named three deputy prime ministers, Ertugrul Yalcinbayir, a lawyer who moved to the AKP from the conservative Motherland Party, Abdullatif Sener, who was finance minister in a 1996 Islamist-led government, and Mehmet Ali Sahin, an Istanbul deputy and one of the founding members of the AKP.

Ali Coskun, who had been among those tipped as a possible economy minister, was given the trade and industry portfolio.

The finance minister will be Kemal Unakitan, who was an adviser to Erdogan when he was mayor of Istanbul. Erkan Mumcu, another former Motherland Party deputy tipped as an outside chance for a top job, will be education minister.