Two top Turkish economic officials are visiting the United Arab Emirates in their first trip abroad since joining President Recep Tayyip Erdogan’s revamped cabinet last month, as the government looks for more foreign cash.
(Bloomberg) — Two top Turkish economic officials are visiting the United Arab Emirates in their first trip abroad since joining President Recep Tayyip Erdogan’s revamped cabinet last month, as the government looks for more foreign cash.
Vice President Cevdet Yilmaz and Finance Minister Mehmet Simsek are set to meet UAE’s President Sheikh Mohamed bin Zayed Al Nahyan in the capital Abu Dhabi, according to people familiar with the matter, who asked not to be named as they aren’t authorized to speak publicly.
The purpose of the visit is to discuss economic cooperation between the two countries, Turkey’s state Anadolu Agency reported.
As Turkey turns the page on years of unconventional policies, it needs the financial backing of key allies as its $900 billion economy comes under strain. On Thursday, the central bank is poised take the biggest step yet in a return to economic orthodoxy by raising interest rates for the first time in over two years.
The outreach to the UAE underscores the improvement in relations between two traditional foes that previously clashed over a range of issues.
Less than two weeks ago, Sheikh Mohamed met Erdogan in Istanbul to discuss ways to strengthen economic cooperation. In March, the Gulf state was also the venue for the first overseas visit by a senior Turkish official since the devastating earthquakes earlier this year.
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The UAE, OPEC’s third-largest oil producer, and Turkey signed off on a comprehensive trade pact earlier in 2023. On top of a $4.9 billion currency swap agreement with Turkey last year, the UAE additionally pledged billions of dollars worth of investments through government-affiliated entities.
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More recently, UAE-based banks have taken the lead in filling the financing void left by Western lenders in Turkey.
Since elections on May 28, which gave Erdogan another five years in office, the Turkish leader has revamped the cabinet after a cost-of-living crisis and declines in the lira to record lows.
Simsek returned as treasury and finance minister five years after resigning from similar roles under the president. The former Merrill Lynch bond strategist has played a key role in devising the implementation of what he’s called “rational” policies.
The appointment of Yilmaz, who oversees the coordination of economic policy across the cabinet, has also been seen as a sign of a looming shift in priorities. A supporter of a more orthodox approach, Yilmaz previously held senior economic positions in the government and parliament.
–With assistance from Ugur Yilmaz.
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