Gulf States’ appetite for investment in Turkey grows
Already able to make the most of a move of supply chains and low-cost manufacturing away from hubs in Asia, Turkey – and its historic Istanbul financial center project – would now be firmly on the radar. Gulf investors.
The signals come amid a rapprochement and efforts to mend ties between Turkey and some Gulf states, including the United Arab Emirates (UAE) and Saudi Arabia, after years of severance.
Even though its construction is still underway, Istanbul’s financial center has already attracted attention, according to Göksel Aşan, head of the presidency’s finance office.
A flagship project scheduled for launch by the end of the first half of 2022, the center aims to become a major financial hub serving numerous banks, public institutions and multinationals.
“A very important part of Istanbul’s financial center will become operational in mid-2022,” Aşan said.
He suggested that there will be a notable commitment from the Gulf countries, especially in terms of funding participation, which he said was of major interest during their talks held in the region.
Istanbul’s financial center will house centers, branches and offices of different institutions in the Gulf countries, Aşan told Anadolu Agency (AA).
President Recep Tayyip Erdoğan said last week that legislative work on this landmark project will soon be completed, stressing the goal of making it a hub for Islamic finance.
“We are looking to become one of the important centers in the world with the financial center of Istanbul. We want this project to also become a center for Islamic finance, ”Erdoğan said.
The IFC project, which started in 2009 and is developed in the Ataşehir district of Istanbul, was designed to be one of the main financial centers in the world.
The development area consists of 723.00 square meters (almost 8 million square feet) of office space, retail, residential buildings, hotels, a large conference center, mosques, ‘schools, parking lots and other community facilities.
Aşan said construction work would be roughly completed by the end of this year.
“Only the central bank building remains. This will be the most ambitious building. We will also have prepared the central bank to relocate by the end of 2022. The center will be operational with a significant part of its capacity by the middle of next year. Our public banks, our regulators and supervisors will also be there, ”he noted.
Great investment appetite
Separately, Izzat Dajani, vice chairman of the board of directors of investment advisory firm Capital Compass, also echoed the investment appetites of the Gulf countries, in particular Qatar, the United Arab Emirates and Saudi Arabia.
“Qatar is a natural investor. They invest a lot of money in real estate and other assets. And then come the United Arab Emirates. I see these two countries ahead of other Gulf investor communities. There are also big investors in Saudi Arabia and a big investment appetite, ”Dajani told the Sabah newspaper.
He said there could be direct acquisitions in the tourism and service sectors, also suggesting potential partnerships in industry and technology.
Highlighting the major disruptions in global production and logistics around the world, Dajani said that Turkey offers serious advantages to foreign investors due to its location, business opportunities, skilled workforce and its exchange rate.
“I see Turkey as a rising bull market. Foreign interest is quite high, especially when it comes to real estate, financial technology, information technology, agriculture, manufacturing, industry, health, education, banking and finance. We are working on six or seven major projects, ”he noted.
Disruptions to the global economy during the pandemic have disrupted supply chains across continents, leaving the world short of a plethora of goods and services, from auto parts and microchips to container ships that transport of goods across the seas.
Many companies, including fashion brand Benetton, flatbed furniture giant IKEA and Polish fashion retailer LPP have recently expressed plans to move production to Turkey to minimize problems with supply chains. worldwide and increasing shipping costs.
Also highlighting Turkey’s geographic advantage, Aşan highlighted the country’s proximity to Europe, Russia, Turkish Republics, North Africa and Gulf countries.
“In fact, Istanbul is the center of attention of all these regions. We are taking positive feedback from our negotiations. We expect that the regional centers of large international companies and financial institutions located in different financial centers will be relocated to Istanbul, ”he suggested.
“These organizations have regional centers. Dubai is one of those important centers. We also see the possibility that there is some displacement from there to Istanbul. “