Saudi, Turkish Companies Strengthen Bilateral Trade Relations
In a significant move, Saudi Arabia and Turkey signed eight agreements in Istanbul, aimed at boosting bilateral trade and investment.
These agreements, signed in the presence of key ministers from both countries, took place during the Saudi-Turkish Joint Business Council meeting.
This event marks a milestone in the evolving relationship between the two nations, promising a robust partnership in various sectors, including industrial, agricultural, finance, tourism, and communications.
Flourishing Partnership
The growth of Saudi companies in Turkey is noteworthy. Post-2011, when Turkey opened its doors to foreign investment, the number of Saudi companies in Turkey jumped from 11 to over 1,100.
The investment is exceeding $11 billion across various sectors.
Trade Dynamics, Challenges
The trade balance has experienced ups and downs. Turkish exports to Saudi Arabia decreased significantly from $3.2 billion in 2019 to $189 million in the first 11 months of 2021. This decline reflects the impact of political tensions and the global pandemic.
Chemical products form a significant part of the trade between Saudi Arabia and Turkey. Notably, in 2021 alone, Turkey imported chemical products worth $2.7 billion from Saudi Arabia, thereby indicating a strong demand in this sector.
Political Tensions, Economic Impact
Between 2018 and 2021, political strains and the COVID-19 crisis led to a considerable decrease in trade. An unofficial boycott by Saudi Arabia during this period further exacerbated the situation.
Recently, Saudi Arabia has shown a willingness to re-establish stronger ties with Turkey. This change in stance is expected to rejuvenate diplomatic and economic relations, opening new avenues for cooperation.
Economic Recovery, Future Prospects
The post-pandemic economic landscape presents unique challenges and opportunities for both countries. The potential collaboration under the Chinese Belt and Road Initiative and regional economic competition are likely to foster closer ties, benefiting both economies.
Investment, Economic Growth
Saudi investments in Turkey, particularly in the industrial sector, have reached $10 billion.
This growth reflects the increasing integration and mutual benefits for both economies.
Turkish contractors, known for their technological superiority, have a significant presence globally, including in the Arabian Gulf states.
In tourism, Turkey has seen impressive numbers. 39 million tourists in 2013 and a revenue of $32 billion, indicating the sector’s potential for Saudi investors.
Riyadh Air’s Strategic Move
Riyadh Air, under the Public Investment Fund, has entered a pivotal partnership with Turkish Airlines. This strategic cooperation is a significant step in enhancing mutual benefits.
Supporting Aviation, Cargo Sectors
The agreement focuses on strengthening the aviation and cargo sectors. Additionally, it aims to bring innovative solutions and further improve operational efficiency in these vital areas.
Emphasis on Digital Development
A key aspect of this agreement is the emphasis on digital development. Firstly, it seeks to integrate advanced technologies to revolutionize the aviation industry, enhancing customer experiences and operational processes.
Moreover, the signing of these agreements and the recent diplomatic overtures suggest a positive trajectory for Saudi-Turkish economic relations.
Furthermore, both countries are poised to overcome past challenges; the future thus holds promising prospects for strengthened trade, investment, and cultural ties.
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