Turkey is seeking more UAE investment in artificial intelligence amid a strengthening of ties between the two countries.
“The UAE is positioning [itself] as a hub for AI investments and we see a similar potential for Turkey. There are tangible outcomes already and there will be more,” Burak Daglioglu, president of the Investment Office of the Presidency of Turkey, told reporters in Istanbul on Wednesday.
Turkey has a “nice pipeline of infrastructure projects”, including data centres, connectivity and renewable energy capacity to attract investments in the AI field, he added.
UAE and Turkey trade and investment ties have surged after the two countries signed the Comprehensive Economic Partnership Agreement, also known as Cepa, in 2023.
There have been several investment agreements spanning different sectors including technology, finance, manufacturing and infrastructure development.
This week, Dubai Islamic Bank signed a $150 million sharia-compliant financing agreement with Turkcell, Turkey’s telecoms and technology services provider, to support the company’s continuing investments in digital infrastructure.
The five-year deal will enable Turkcell to advance critical infrastructure in areas such as data centres, cloud technologies and renewable energy, DIB said on Wednesday.
Last month, G42’s Khazna also announced plans to build an AI-capable data centre in Turkey, with a potential capacity of up to 100 megawatts, after securing a site in Ankara. The Abu Dhabi-based company intends to continue investing in Turkey and expand its data centre network, following the completion of the new site, it said last month.
Turkey is also looking to attract UAE investments in sectors such as HealthTech, renewable energy and manufacturing, Mr Daglioglu said.
In 2022, Turkish President Recep Tayyip Erdogan made his first official visit to the UAE in almost a decade to strengthen ties with the Emirates. President Sheikh Mohamed visited Turkey at the end of 2021.
The UAE's non-oil trade with Turkey grew by 11.5 per cent on an annual basis to Dh148.9 billion ($40.54 billion) last year, official data shows.
“The most important development in the recent years was the free trade agreement between the two countries because it paved the way for a larger trade volume,” Mr Daglioglu said.
“After trade, the opportunity for investment is also higher. In the following years, the investment pipeline from UAE to Turkey will be growing.”
It’s not just the UAE companies that are investing in Turkey, after the free trade agreement, “Turkish companies have started investing in UAE as well”, he added.
Last year, the total UAE investments to Turkey was $307 million, while Turkey’s investments in the UAE totalled $576 million, according to data provided by the Turkey Investment Office.
Since 2002, the UAE has made $5.9 billion worth of investments into Turkey, while Turkey’s investments into the UAE during the same period totalled $2.4 billion, the data shows.
There were 604 Emirati companies operating in Turkey by the middle of last year.
Turkey, whose economy is expected to grow by 2.7 per cent this year, is also focusing on boosting start-up ecosystem, Mr Daglioglu said.
They brought in new legislations, supported start-ups with funding and encouraged more sovereign wealth funds to invest.
“We have successful start-ups, not focusing on exits … the previous trend was make an exit to a larger local player. Now, Turkish companies are becoming regional players,” Mr Daglioglu said.
In 2022, Abu Dhabi's holding company ADQ and Turkey Wealth Fund formed a new $300 million technology fund to invest in start-ups in Turkey.
Energy and utilities, health care and life sciences, food and agriculture, mobility and logistics, financial services, and education were the sectors that the fund targeted to invest.
