Turkey is betting on Emirati and Gulf investments to rescue its struggling economy

Turkish President Recep Tayyip Erdogan began a visit to the United Arab Emirates, the final stop on a Gulf tour during which he sought to attract investments to his country, which is suffering from a severe economic and financial crisis, while the living conditions of large segments of Turks have deteriorated due to ongoing inflation.

The three-day tour included Saudi Arabia and Qatar, where agreements were signed to revitalize Turkey’s economy, which is facing significant inflation and a collapse in the exchange rate of the national currency.

The Emirates News Agency “WAM” reported that Erdogan arrived in the UAE on an official visit to the country, accompanied by his wife, Amina Erdogan, coming from Qatar, where he met the country’s Amir, Sheikh Tamim bin Hamad Al Thani. The two presidents confirmed during their talks “the strong desire of both countries to deepen bilateral cooperation through enhancing trade exchange and economic relations.”

President Erdogan gifted his Emirati counterpart, Sheikh Mohamed bin Zayed Al Nahyan, a domestically manufactured car called “TOGG.” Erdogan presented the white-colored car to the Emirati President after their bilateral meeting at the Qasr Al Watan in Abu Dhabi. The two leaders examined the car for a while in the palace courtyard and then took a photo in front of it.

The white color of the car is named “Pamukkale,” after the white limestone rocks that resemble cotton in the tourist area of Pamukkale in Denizli province, western Turkey. Ankara owns 100% of the intellectual and industrial property rights of the car and seeks through it to build a global brand and form a nucleus for a comprehensive Turkish transportation system.

This is Erdogan’s second visit to the UAE since the return of warmth to the relations between the two countries in late 2021, after several periods of tension in the past decade.

The UAE and Turkey supported conflicting parties in the war in Libya and differed on the issue of gas exploration in the Mediterranean Sea. Ankara also provided support to members of Islamic groups, including the “Muslim Brotherhood,” classified as a “terrorist” organization in the UAE and the Gulf.

Relations were also strained due to the blockade imposed by Saudi Arabia, the UAE, Bahrain, and Egypt on Qatar, Turkey’s closest ally, which lasted from mid-2017 until early 2021. Tensions also escalated with Gulf countries, especially Saudi Arabia, in the aftermath of the murder of Saudi journalist Jamal Khashoggi in Istanbul in 2018.

However, the return of Turkish-Gulf relations opens the door to increased investments in the Turkish economy. In March 2021, the UAE and Turkey signed a comprehensive economic partnership agreement aimed at increasing non-oil trade value to $40 billion annually within 5 years. In 2021, a $10 billion fund was established to support investments in Turkey.

The total non-oil trade between the UAE and Turkey amounted to approximately $19 billion in 2022, an increase of 40% compared to 2021 and 112% compared to 2020, making Turkey one of the top 10 trading partners of the UAE, according to official Emirati data.