Background: Turkey has repeatedly condemned Israeli attacks in Gaza, accusing Netanyahu's government of opposing peace and aiming to displace Palestinians. New development: Turkish Foreign Minister Hakan Fidan, speaking alongside Egyptian officials in El-Alamein, accused Israel of aiming to expel all Palestinians from Gaza and called for immediate international pressure on Netanyahu. He said Ankara and Cairo joined the Trump-backed Board of Peace to stop the genocide, claiming partial success. The Gaza death toll has surpassed 73,389, with thousands more missing under rubble.

Turkish President Recep Tayyip Erdoğan addressed a large rally in Ankara on August 14, 2026, marking the 25th anniversary of the ruling Justice and Development Party (AK Party). He highlighted achievements in infrastructure, defense, and public services, and pledged the party would continue its push for change. Erdoğan also emphasized the importance of nurturing a new generation, referenced the 'terror-free Turkey' process, and thanked alliance partners, including MHP leader Devlet Bahçeli. The AK Party has been Turkey's dominant political force since 2002.

Over the past 25 years, Turkey's defense industry has evolved from a foreign-dependent sector into a global exporter, with the number of firms growing from 56 in 2002 to over 4,500 today, and project volume rising from $5.5 billion to over $100 billion. Defense exports surged from $248 million to $10.05 billion in 2025, with shipments reaching $5.79 billion in the first seven months of 2026. The sector now produces indigenous systems including drones, fighter jets, helicopters, warships, and air defense systems, with domestic content exceeding 85%. This transformation, coinciding with the AK Party's 25th anniversary, has positioned Turkey as the world's 11th-largest defense exporter, driven by frustration over Western allies' failure to provide adequate defense systems.

In June 2026, Azerbaijan became Türkiye's largest pipeline natural gas supplier, delivering 1.01 billion cubic meters (bcm), surpassing Russia (882 million cubic meters) and Iran (883 million cubic meters). This marks the first time in 2026 that Azerbaijan has led, as Russia had been the top supplier for the first five months. This shift reflects Türkiye's ongoing energy diversification strategy, which includes a 15-year deal with Azerbaijan's Absheron field and expanded US LNG imports. Türkiye's total natural gas imports fell 6.19% year-on-year to 3.06 bcm, while consumption rose 4.59% to 2.83 bcm. Pipeline deliveries accounted for 2.78 bcm, with LNG imports at 282 million cubic meters, all from Algeria. Storage volumes stood at 5.27 bcm at end-June, indicating changing supply dynamics and reduced reliance on Russian gas.

Hyundai has commenced mass production of its IONIQ 3 electric vehicle at its Izmit plant in Kocaeli, Türkiye, becoming the first foreign automaker to manufacture battery-powered passenger cars in the country and marking its first EV production in Europe. The company is investing approximately 250 million euros, with an initial annual output of 30,000 vehicles, and plans a new 55 million euro battery assembly facility. Turkish Industry Minister Mehmet Fatih Kacır highlighted the investment as a key step in Türkiye's strategy to become a regional hub for EV and battery production, noting the country's growing domestic EV market and its goal to exceed 1.5 million electric vehicles by 2030.

On August 14, 2026, Turkish Republic of Northern Cyprus (TRNC) President Tufan Erhürman and Prime Minister Ünal Üstel led commemorations for the 52nd anniversary of the 1974 killings of 126 Turkish Cypriots in the villages of Muratağa, Sandallar, and Atlılar. The ceremonies included wreath-laying and prayers at the mass grave sites. Erhürman criticized international silence on the killings, while Üstel referenced ongoing 'unjust isolation and embargoes' against Turkish Cypriots. The event underscores the enduring legacy of intercommunal violence in Cyprus and the unresolved political status of the island.

The Central Bank of the Republic of Turkey's August survey of market participants revealed a slight uptick in year-end 2026 inflation expectations to 29.43% from 29.21%, while the 12-month forecast improved to 23.69% from 23.95%. The survey also showed a weaker lira outlook, with the year-end USD/TRY forecast rising to 51.66 and the 12-month expectation to 57.43. Growth expectations remained stable at 3.1% for 2026 and 4% for 2027. Participants anticipate the central bank will hold its policy rate at 37% at the next meeting, with gradual easing to 29.59% in 12 months, reflecting ongoing disinflation expectations despite energy price pressures.

Background: On July 5, 2026, Turkish and Pakistani leaders set a target to increase bilateral trade to $5 billion. On August 14, 2026, Pakistan's Consul General in Istanbul, Khawaja Khurram Naeem, reiterated the need for robust business-to-business engagement to complement strong political relations, pointing to Pakistan's economic potential and reforms, including government efforts to reduce corporate tax rates. Business leaders at the forum emphasized that the current $1.2 billion trade volume is modest and urged more B2B meetings and reciprocal visits to elevate cooperation.