According to Reuters, Abu Dhabi Ports Groups, a state-run organisation of the United Arab Emirates, is expected to buy a stake in a key Turkish port, in a further sign of rapprochement between Ankara and Abu Dhabi after years of geopolitical rivalry.
State-owned AD Ports Group is expected to invest in an entity to be set up by Turkey’s Wealth Fund to manage the port of Izmir on the Aegean coast, two sources close to the deal told the news agency.
Although the price of the stake is not yet known, one of the sources indicated that the deal could be valued at around 500 million dollars. The port of the Mediterranean city, owned by Turkey’s sovereign wealth fund, is a key gateway for the country seeking new investment.
Likewise, the port of Izmir, with a surface area of 902,000 square metres, is the seventh largest in Turkey in terms of container volume and the thirteenth in terms of cargo tonnage.
The deal coincides with the Turkish government’s efforts to attract foreign investment in order to tackle the severe economic crisis facing the Eurasian nation. Years of state financial mismanagement have sent inflation soaring and the national currency, the Turkish lira, plummeting. Some Western investors have begun to return to Turkey, looking at the situation in emerging markets, which is aiming to improve indicators and restore its economy.
On the other hand, the Holding Company (ADQ), one of the sovereign wealth funds of the Emirate of Abu Dhabi, began two years ago to develop an expansion plan abroad by buying assets and managing several ports. Senior Emirati officials have stressed that they see huge investment opportunities in Turkey, with emphasis on the fields of energy and logistics.
In this respect, the purchase of a stake in a Turkish port by the Emirati state-owned giant Dubai Ports World stands out. This acquisition is part of an agreement signed last May between the United Arab Emirates and Turkey on free trade with the aim of facilitating investment.
Two months later, in July, the two countries agreed on a series of deals worth more than $50 billion during a trip by Recep Tayyip Erdogan to the Gulf states to revive the Turkish economy.
The Turkish president’s visit also saw Abu Dhabi and Ankara begin to mend relations after years of tensions and rivalries based on ideological differences that led each country to support different sides in conflicts in the Middle East and North Africa, such as in Libya.
Recently, to further boost bilateral relations, President Erdogan met with his Emirati counterpart, Sheikh Mohammed bin Zayed Al Nahyan, on the sidelines of the climate conference (COP28) in Dubai.
Despite Abu Dhabi’s growing interest in the potential of Turkish ports, the Emirates is not the first Gulf country to invest in them. In early 2021, QTerminals, a Qatari commercial port operator, bought the Turkish port of Antalya – Port Akdeniz – owned by Turkish conglomerate Global Yatirim Holding. Also, last November, Bloomberg reported that Turkish billionaire Ferit Sahenk had discussed with the Qatar Investment Authority the possible purchase of Galataport, a commercial hub and cruise port in the heart of Istanbul.
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