UAE Sets Up $10 Billion Fund to Support Turkey as Ties Warm
(Bloomberg) -- The United Arab Emirates outlined plans to launch a $10 billion fund to support investments in Turkey as the countries signed a string of accords Wednesday during one of the highest-level visits in years between the old Middle East foes.
The fund will focus on strategic sectors such as energy, food and healthcare, the UAE’s state-run WAM news agency reported. The UAE, a small but influential Persian Gulf oil-and-business powerhouse, and Turkey also signed cooperation deals for their wealth funds, stock exchanges and central banks.
UAE de facto ruler Sheikh Mohammed Bin Zayed Al Nahyan was received in Ankara by President Recep Tayyip Erdogan, who’s facing turmoil in currency markets as he relentlessly pursues lower interest rates, and fading popularity ahead of 2023 elections.
The lira strengthened during the visit, the clearest sign yet of efforts to patch up frosty relations that have shaped parts of the Middle East. The currency was trading up 4.8% at 12.2380 per dollar at 7:18 p.m. in Istanbul, after slumping as much as 15% the day before.
Among the day’s developments:
- Abu Dhabi Securities Exchange and Borsa Istanbul signed a cooperation agreement, while Abu Dhabi Ports inked a deal for port and logistics investments in Turkey.
- The countries’ central banks signed a memorandum of understanding for cooperation, and the countries also agreed to work together on energy.
- Abu Dhabi’s sovereign wealth fund ADQ signed a cooperation deal with the Turkish Presidency Investment Office on foreign direct investment involving energy, petrochemicals, technology, transportation, infrastructure, health care, financial services, food and agriculture.
- ADQ is also expected to sign cooperation agreements with closely held Turkish companies Kalyon and CCN, according to a Turkish official.
The visit caps a warming of ties that started earlier this year and could unlock billions of dollars in trade and investment. Abu Dhabi’s wealth funds have already spent months scouting for investments in Turkey, Bloomberg reported earlier this year.
The UAE has sought to step back from regional conflicts and refocus on the economy. Its ties with Turkey had been strained over the role of Islamist groups in the tumult that followed the 2011 Arab Spring uprisings.
The two countries also supported opposing sides in Libya’s conflict, and have disagreed on other issues including gas exploration in the Eastern Mediterranean.
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