The UAE’s USD 51 bn investment pledge in Turkey is facing setbacks as Ankara’s stronger economic position complicates negotiations, Bloomberg reports. Initially announced in July 2023 after President Recep Tayyip Erdogan’s reelection, the pledge was meant to boost Turkey’s recovery and reconstruction efforts. However, with Turkey stabilizing its foreign reserves and securing alternative financing, companies have been reluctant to accept lower valuations, dampening momentum for UAE-backed agreements.

In context: Several high-profile agreements have fallen through, including AD Ports Group’s failed acquisition of Alsancak Port, First Abu Dhabi Bank’s bid for Yapi Kredi Bankasi, and Masdar’s talksto acquire Fiba Yenilenebilir Enerji, with valuation disputes cited as a major sticking point. So far, ADQ’s acquisition of Odeabank remains the only major transaction to close.

Despite these setbacks, Turkish officials remain optimistic. Burak Daglioglu, who heads Turkey’s Presidential Investment Office, recently expressed confidence that investment flows between the two countries will continue to expand under the Comprehensive Economic Partnership Agreement between the countries.

Other projects could still go through: The UAE has reportedly been in talks with Turkey to grant the Turkish government a loan to finance the railway project across Istanbul’s Bosphorus Strait.

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