Analyzing How Erdogan’s Regional Tour Pushed Turkey and Gulf Further into a Strategic Partnership

28 July 2023


Turkish President Recep Tayyip Erdogan concluded a three-day Gulf tour, which included visits to Saudi Arabia, Qatar, and the United Arab Emirates. The tour, which ran from July 17 to July 19, yielded significant positive results, prompting many to discuss the transition of Gulf-Turkish relations towards a strategic partnership and enhancing hopes for promising future prospects between the two sides.

Economy First

Economic cooperation took precedence on the agenda of Erdogan's Gulf tour, given the recent decline in Turkey's economy, the repercussions of the powerful earthquake which hit the country earlier this year, and the devaluation of the Turkish lira against the US dollar. Turkey aims to promote and strengthen mutual trade and investment, especially in light of the growing economic power of Gulf Arab countries and their financial surpluses. Halting economic deterioration, achieving economic growth, and ensuring sustainability are crucial goals for Erdogan's government, particularly following his re-election. The country is reeling under the ongoing Turkish lira crisis, where the currency has depreciated by more than 28% this year, and massive economic losses estimated at around USD 84 billion, equivalent to 10% of the country's GDP, that were caused by the earthquake.

Erdogan himself emphasized that economy is a priority in his Gulf tour, stating that during his visits the primary agenda will be joint investment and finance with these countries, and that he has high hopes. Investment in these countries and in Turkey will be a topic for discussion, he said. Ankara’s interest in the tour was well-reflected by the size of the Turkish 200-member business delegation accompanying Erdogan and participating in talks in the three Gulf countries. 

Although trade between Turkey and Gulf Arab countries grew from USD 1.6 billion to about USD 22 billion over the past 20 years, as noted by Erdogan, Ankara aims to further enhance trade and investment cooperation with the regional bloc, which it sees as one of the pillars of future economic revival in Turkey. Turkey has ambitious plans to almost triple this figure over the next five years. 

The Route of Development, an economic corridor between Turkey and the Gulf that was announced in early June, is one of the significant initiatives on which Ankara relies to develop economic cooperation with the Gulf. The project, which consists of a rail line and a motorway, would span the length of Iraq, stretching 1,200 kilometers from the northern border with Turkey to the Gulf in the south. If completed, this new corridor would significantly contribute to revitalizing trade relations between Turkey, Iraq, and Gulf countries, particularly in the oil and gas sector, making Turkey a pivotal country in the energy sector and strengthening trade relations between Gulf countries and Europe.

Although it was the headline, the economy was not alone on the agenda of President Erdogan’s Gulf tour. Other objectives of the tour include Ankara's pursuit to regain its regional role, rebuild and strengthen its relations with Gulf countries after they were interrupted by tensions, especially with Saudi Arabia following the killing of the Saudi journalist Jamal Khashoggi and Turkey's stance on the Qatar crisis before it was resolved in January 2021. 

Additionally, the tour aimed to enhance strategic cooperation between the two sides including in the defense and military fields as well as traditional and clean energy sectors. Moreover, it sought to coordinate efforts on climate action, given the leading role of Arab Gulf countries and the United Arab Emirates in particular in the international climate agenda this year, notably by hosting the "COP 28" conference in November and December.

Walking the Path of Partnership

Erdogan's Gulf tour had significant outcomes that outline a promising path for the future of economic and strategic partnership between the Gulf countries and Turkey. On the economic level, the United Arab Emirates and Turkey signed memoranda of understanding and agreements estimated to be worth USD 50 billion with Turkey in various fields. These include an agreement on reciprocal promotion and protection of investments; a memorandum of understanding on collaboration in the field of digital transformation;  a strategic partnership framework agreement on developing energy and natural resources projects; a memorandum of cooperation on the development of joint launch vehicle capabilities for commercial purposes between the UAE Space Agency and the Turkish Ministry of Science, Industry and Technology and the Turkish Space Agency; a memorandum of understanding on investing in sukuk for the purposes of the reconstruction of areas of Turkey affected by earthquakes, between ADQ and the Turkish Ministry of Treasury and Finance, and a strategic cooperation agreement between the Abu Dhabi Investment Office and the Investment Office of the Presidency of the Republic of Turkey.

In addition, several economic agreements between Turkey, Qatar and Saudi Arabia were signed, but the exact value of these agreements were not disclosed. The announcement was made one week after the Saudi-Turkish Business Forum, which was held in Istanbul and saw the signing of 16 cooperation agreements between Saudi and Turkish companies in various sectors, including real estate development, construction, engineering consulting, and several other investment sectors, with a total value exceeding 2.3 billion Saudi riyals.

The new economic agreements are focused on increasing Gulf investments in Turkey. Gulf countries' investments have accounted for 7.1% of foreign direct investment in Turkey since 2020, reaching a value of around USD 15.8 billion in 2022. The amount is expected to double to USD 30 billion over the next few years through investments that prioritize sectors such as energy, defense, finance, retail, and transportation.

Turkey also seeks to increase its share in the massive investments flowing into infrastructure and construction projects in several Gulf countries, including ambitious projects in the UAE in the fields of space, renewable energy, and modern technology, as well as Saudi Arabia’s mega-project Neom 

In general, the economic forums, agreements, and memoranda of understanding organized and which Turkey signed with the United Arab Emirates, Saudi Arabia, and Qatar, show that they have a shared view on developing a long-term and diversified economic partnership in the near future.

At the strategic and defense level, the results of Erdogan's tour reaffirmed once again the commitment of both sides to enhance their strategic partnership. During his visit to the United Arab Emirates, a high-level strategic committee was announced in a ceremony attended by President of the UAE His Highness Sheikh Mohammed bin Zayed Al Nahyan, and Turkey’s President Recep Tayyib Erdogan. Additionally, the two countries signed a memorandum of understanding to promote strategic cooperation on defense industries between the UAE’s Tawazun Council and Turkey’s Defence Industry Agency. The two countries also signed an extradition agreement.

The most significant development was an agreement signed by Turkey’s Baykar Defence to supply Saudi Arabia’s army and navy with Bayraktar Akıncı armed drones. This deal, the largest for Baykar so fast, enables Riyadh to achieve superiority in military operations in the Red Sea, the Arabian Sea, and the Gulf. Additionally, the deal strengthens Turkey's cooperation with Saudi Arabia in areas such as joint manufacturing, technology transfer, training, technical support, and logistics.

Moreover, this deal is set to bolster the Turkish defense industry. Turkey's defense exports in 2022 amounted to USD 4.3 billion, and are expected to increase about 50% this year to USD 6 billion this year. 

At the political level, there is no doubt Erdogan’s tour, his first to the region after his re-election as president for a third term, has significantly contributed to bridging the gaps on various regional issues after differing stances were a cause of disagreements and tensions between Turkey and the Gulf. This tour not only will strengthen political cooperation between the Gulf and Turkey in the future but will also help in resolving several regional crises, in Sudan, Libya and Syria for example, in which both sides play crucial roles. 

That is why any political consensus between Turkey and the Gulf Arab states would contribute to enhancing security and stability in the entire Middle East region. Given the political and strategic weight of both sides, and given their influential regional roles, their cooperation has the potential to effectively promote peace and stability across the broader Middle East.

Other significant issues on which both sides reached consensus include climate action. Ankara supported the efforts made by the United Arab Emirates to host and organize an exceptional edition of the 2023 United Nations Climate Change Conference, more commonly referred to as COP28. The UAE expressed its desire for active Turkish participation to achieve outcomes that benefit the entire world. Notably, there is existing cooperation between the two countries in the field of climate action, and they both have ambitious plans in place for renewable energy and carbon neutrality.

In summary, the significant outcomes of President Erdogan's Gulf tour have the potential to upgrade the Turkish-Gulf relations from a phase of improving ties into a long-term strategic partnership. Such a development sets the foundation for a new phase characterized by constructive cooperation aimed at serving the common interests of both parties, enhancing stability, peace, and development across the region.