The End of a Long Period of Tense Relations

The End of a Long Period of Tense Relations

Last week marked a turning point in the diplomatic relations between the United Arab Emirates (UAE) and Turkey as the two countries signed technology and energy cooperation agreements worth billions of dollars. The Memorandums of Understanding were signed during Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed al-Nahyan's visit to Ankara, his first diplomatic visit to Turkey in several years.

The agreements, signed after a round of talks between Turkish President Recep Tayyip Erdoğan and the UAE's Crown Prince, mark the end of a long period of tensions between the two states. During the visit, the two rulers indicated their wish to work together to further strengthen their bilateral relations. The visit seems to indicate both parties’ readiness to turn the page on past hostilities. The crown prince notably indicated on Twitter: "I look forward to exploring new cooperation opportunities to benefit our two nations and advance our mutual development goals ". 

The UAE also announced the launch of a USD 10 billion health and energy investment fund for Turkey. Through its sovereign wealth funds, the UAE has already invested in Turkish e-commerce platforms and appears anxious to strengthen its ties with the country to further increase its stake in the Turkish economy.

Foreign Minister Mevlüt Çavuşoğlu is expected in Abu Dhabi in December to build on this momentum. On the sidelines of the visit, the central banks of the two countries also signed a cooperation agreement. Over the past few months, Turkey's central bank has been seeking swap agreements with foreign countries to alleviate the pressure on its financial and banking system. Such agreements will allow Turkey to replenish its reserves of hard currency as well as help support the lira, which lost as much as 45 percent of its value in 2021. This year, Turkey has also worked on easing tensions with both Saudi Arabia and Egypt.