UAE Sets up $10 Bln Fund to Support Financial Co-op with Turkey

On Wednesday, the United Arab Emirates (UAE) announced a $10 billion fund for investments in Turkey, the Emirates News Agency (WAM) reported.

This came as Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, held talks with Turkish President Recep Tayyip Erdogan in Ankara on Wednesday, opening a new chapter in relations between the two countries.

The lira strengthened ahead of the visit, the clearest sign yet of efforts to patch up frosty relations that have shaped parts of the Middle East.

The visit caps the 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.

This week Erdogan’s relentless pursuit of lower interest rates sparked a currency crisis, with the lira losing 25% of its value against the dollar in the past month, and more than 40% so far this year. Erdogan is keen to repair ties with the OPEC oil producer, potentially opening up new sources of investment.

Ties between the countries had been strained over the role of Islamist groups in the tumult that followed the 2011 Arab Spring uprisings. The two countries supported opposing sides in Libya and have disagreed on issues including gas exploration in the Eastern Mediterranean.