This surprising upset could upend the Dutch election

The wild card in the general elections in the Netherlands today is Turkey and the growing antiimmigration policy sentiment among the Dutch. A recent political spat has led Turkey to end diplomatic relations with its longstanding NATO ally. The war of words between the two countries has intensified this week after the Netherlands banned two Turkish ministers from holding public rallies in the country to support a referendum aimed at giving Turkish President Recep Tayyip Erdogan greater power.

Erdogan fumed about the Dutch government after the news, calling them "Nazi remnants and fascists" while speaking to a crowd in Istanbul.

The standoff is the latest move by Erdogan, who has cracked down on opposition — particularly journalists, academics and the public-service sector — since a July coup attempt in hopes of pushing through an April referendum that would expand his powers. In the Netherlands, today's general elections will pit hard-line anti-Islam candidate Geert Wilders, leader of the far-right Freedom Party, in a tight race against the incumbent Prime Minister, Mark Rutte.

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It's a power grab that is affecting Turkish relations with a host of other countries, as well including Germany and Greece.

Under a state-of-emergency regime, President Erdogan is conducting an all-out campaign to rally supporters at home and throughout Europe. His goal: to eliminate opposition ahead of a constitutional referendum on April 16, where a "yes" vote would officially grant him even more unchecked authority over the executive, legislative and judiciary branches of government, which critics claim is reminiscent of the Ottoman Sultan, who once ruled one of the world's greatest empires.

To achieve his purpose, Erdogan is running campaigns outside Turkey. He especially aims at drumming up support for himself among Turkish citizens in Germany. Germany hosts the biggest Turkish diaspora in the world, with approximately 530,000 Germans also holding a Turkish passport. At the same time, 1.5 million Turkish people reside in Germany without German passports, and 800,000 people of Turkish origin have solely a German passport.

The prospect of President Erdogan campaigning for the referendum in Europe is disquieting for European politicians, and many Northern European countries have banned these events. Reacting strongly, the Turkish president has called almost all of the Northern Europeans "Nazis." Pointing to the German, Dutch, Austrian and Danish bans on Turkish ministers attending rallies in Turkish expat communities, he referred to "a new Nazism tendency."

German politicians reacted with anger. German Justice Minister Heiko Maas told broadcaster ARD that Erdogan's comments were "absurd, disgraceful and outlandish" and designed to provoke a reaction from Berlin. Chancellor Angela Merkel's spokesman said that the German government "strongly rejected" the equation of modern Germany with Nazi Germany, adding that such comparisons minimized the crimes of the Nazis. Steffen Seibert, head of the German governmental press and information agency, noted that Turkish officials had a right to the same freedom of speech and assembly as others do in Germany, but insisted that appearances needed to be transparent and permitted by (local) authorities.

Two weeks ago the German authorities summoned the Turkish ambassador to Berlin to protest the arrest of Deniz Yücel, a dual citizen of Turkey and Germany, who was charged with propaganda in support of a terrorist organization and inciting the public to violence. Yücel , a correspondent for Die Welt newspaper, faces up to 10 years in prison. He was detained in mid-February after having reported on emails that a leftist hacker collective allegedly obtained from the private account of Berat Albayrak, Turkey's energy minister and the son-in-law of President Recep Tayyip Erdogan.

A poll conducted for the Bild am Sonntag newspaper showed that 81 percent of Germans believe Merkel's government has been too accommodating with Ankara. Germany, under an agreement signed last year, relies on Turkey to prevent a further flood of migrants from pouring into Europe. The German newsmagazine Der Spiegel urged Merkel to free herself from the "handcuffs of the migrant deal." But that would lead millions of refugees to flee to countries such as Greece and Italy, repeating the humanitarian crisis of 2015.

In response to the botched coup, President Erdogan and the ruling Justice and Development Party, or AKP, are pursuing an ongoing purge of all opponents and critics, be they seculars, liberals, Leftists or ethnic Kurds. The main thrust is against the Fethullah Gullen movement, which Turkey's government claims was behind the coup. Gullen, a Muslim cleric and former Erdogan political ally, currently resides in the United States.

Moreover, Turkey accuses Syria's Kurds, whom the United States considers indispensable allies in the fight against ISIS, as directly linked to the Kurdish Workers' Party, or PKK, which in turn is considered a terrorist organization by Turkey, the United States and Europe.

According to human rights NGO Amnesty International, more than 40,000 people have been remanded in pretrial detention during the first six months of emergency rule following last July's coup attempt. Amnesty says there is evidence of torture of detainees. Moreover, nearly 90,000 civil servants have been dismissed, while hundreds of media outlets and NGOs were closed down and journalists, activists and lawmakers were detained.

A body of constitutional law experts advising the Council of Europe, of which Turkey is a member, found that there has been a "dramatic decline in democratic order" and that the country is "on the road to an autocracy and a one-person regime."

Turkey responded instantly. The deputy speaker of Turkey's parliament, Ahmet Aydin, accused the Council of Europe of "severe criticism based on groundless claims," state-run news agency Anadolu reported.

The coup attempt and its aftermath is a reflection of growing polarization in Turkish politics, with many deciding to leave the country.

From August 2016 to January of this year, Germany has received 136 asylum requests from people holding Turkish diplomatic passports. The overall number of asylum applications from Turkey rose from 1,800 in 2014 to 4,600 in 2015 and 5,700 last year. Most of those who applied for asylum in 2016 said they belonged to the Kurdish ethnic minority, Plate said. According to earlier reports in the Dutch press, more than 100 Turkish NATO soldiers have applied for asylum in the Netherlands, Belgium and Germany in the aftermath of the attempted coup.

In Greece, 10 Turkish military personnel have requested asylum, while the total of Turkish citizens tallies more than 100 since last July. On Sunday four Turkish citizens who illegally crossed to Greek island Chios by an inflatable boat requested asylum. The group introduced themselves as Kurdish politicians and requested an application for asylum on the grounds that they had no life safety.

Political instability, including more than 400 terrorist attacks in the last two years, has hit what was once Turkey's booming tourism sector, with a 30 percent fall in the number of European tourists who used to make up more than half of the visitors. According to IMF figures, the industry generated 600,000 jobs, or 2.3 percent of total employment, with another 1 million jobs in related sectors, such as restaurant and leisure industries.

This has contributed to a decline in the overall economy, which is projected to grow by 2.7 percent in 2016 and 2.9 percent in 2017, according to the IMF. It shrank 1.8 percent in the third quarter of 2016, the first decline in seven years.

Government seizure of property has also been an issue. Since the coup attempt, the government has seized the assets of more than 600 businesses in the country.

All this has put pressure on the Turkish lira. On Tuesday it closed at 3.72 to the dollar.

The United States and the EU are cautious to confront President Erdogan because of Turkey's role in combating ISIS and stemming migrant flows to Europe. In January, Brett McGurk, the U.S. Special Presidential Envoy for the Global Coalition to counter ISIS, addressing a conference in Washington, D.C., admitted that the situation is extraordinarily complex.

"We have to take into account first and foremost Turkey's very realistic national security concerns — it's a NATO ally," he said. "And we also have to have a viable plan for getting ISIS out of Raqqa (Syria)," he added.

— By Nasos Koukakis, special to CNBC.com