Turkey is optimistic about securing significant investments from the United Arab Emirates (UAE) and Saudi Arabia in its energy and defense sectors after high-level economic discussions in Abu Dhabi, Reuters reported on Thursday, citing two sources familiar with the talks.
Turkish Vice President Cevdet Yılmaz and Finance Minister Mehmet Şimşek flew to the UAE on Wednesday to conduct preliminary negotiations preceding a possible visit by President Recep Tayyip Erdoğan.
Following his re-election last month Erdoğan appointed Yılmaz and Şimşek to his cabinet, suggesting a move away from the unorthodox economic policy he had pursued for years. This policy had contributed to a significant rise in inflation, a slump in the lira’s value and a decrease in foreign exchange reserves.
Ankara embarked on a diplomatic initiative in 2021 to repair its strained relations with Saudi Arabia and the UAE. Investments and financing from the Gulf have since then played a crucial role in alleviating the pressure on Turkey’s beleaguered economy and hard currency reserves.
The sources revealed that Gulf officials are considering direct investments in Turkey’s energy and defense sectors now that the elections are behind them. However, the specifics regarding the status, scale and timeline of potential agreements remain uncertain.
“Money inflow is expected in the coming period, especially from the Gulf region. They’ve made some high-level contacts in Turkey. There will be some direct investments from Saudi Arabia and the UAE,” Reuters quoted one of the sources as saying.
Turkey’s finance ministry and Erdoğan’s office did not immediately respond to a Reuters request for comment.
Ankara had previously announced that Yılmaz and Şimşek were set to discuss opportunities for economic collaboration with their UAE counterparts and meet with President Sheikh Mohammed bin Zayed al-Nahyan.
Erdoğan’s proposed shift to more traditional policies will face a significant challenge on Thursday. The central bank, under its new governor, Hafize Gaye Erkan, is predicted to implement a steep hike in interest rates.