Gul Meets with King Abdullah as Turkey Seeks Saudi Investments

Publication: Eurasia Daily Monitor Volume: 6 Issue: 24

Abdullah Gul (left) and King Abdullah of Saudi Arabia meet in 2007 (Getty Images)

From February 3 to 5 Turkish President Abdullah Gul is visiting Saudi Arabia as King Abdullah’s official guest. Gul is accompanied by several members of the Turkish cabinet as well as about 150 Turkish businessmen. Since the visit comes amid discussions on how to bring calm to the Middle East in the wake of Israel’s Gaza offensive, it provides an opportunity for the leaders of the two major regional countries to discuss developments in their neighborhood. The visit also marks the deepening bilateral ties between Turkey and Saudi Arabia, which have gained momentum since the Justice and Development Party (AKP) came to power in 2002. In addition to bilateral and regional matters, Gul and his hosts discussed issues important to the Islamic world.

Gul spoke at the Consultative Assembly of Saudi Arabia, which made him the first Muslim head-of-state to address the Saudi assembly. Regional peace and Gaza-related developments took up a major part of Gul’s speech. He praised King Abdullah’s work toward ensuring regional peace and stability and described Riyadh’s foreign policy as "constructive and responsible." "We always maintain close political consultation about regional issues," Gul added (, February 4).

Gul complemented King Abdullah for his past efforts to resolve the Palestinian problem, and he gave his support to the Saudi peace plan, which called on Israel to withdraw to its 1967 borders in return for normalization of relations with its Arab neighbors. He also reiterated Turkey’s position that the solution of the conflict depends on ensuring reconciliation among Palestinian factions. As a successful example of mediation, Gul cited a meeting between Fatah and Hamas that was hosted by King Abdullah in Mecca in 2007. He asked the leaders of Arab and Muslim countries to work toward ensuring that Palestinians achieve a national unity government. In an Islamic internationalist tone, he presented the Palestinian problem as the responsibility of the Muslim nations: "The number one issue is the unity of the Palestinians, the unity of the Arab world, and the unity of the Muslim world, with all of us showing our responsibility and desire to act together when there are major issues" (Today’s Zaman, February 5).

In his address to the Saudi assembly, Gul also touched upon another issue of common interest to Muslims worldwide. Gul expressed his concern about growing "Islamiphobia" in the West. Gul argued that the source of misperceptions and growing enmity toward Islam was the tendency in some circles to equate Islam with terrorism. Noting that terrorism may spring from any society and any religion, he described Islam as a religion of peace that urged its followers to respect others (Zaman, February 5).

The visit also highlighted the flourishing Turkish-Saudi bilateral relationship. The Turkish president said that he felt at home on his the trip, calling Turkey and Saudi Arabia sister states and sister nations. Gul recalled that King Abdullah had gone to Turkey in 2006 and 2007 and that these two visits in such a short time had shown Riyadh’s "extraordinary attention and concern for Turkey." Gul added that he had wanted to return the gesture by paying a visit without any delay to show the high esteem that Turkey attached to relations with Saudi Arabia (, February 4). Diplomatic observers believe that Riyadh might be seeking to develop a strategic partnership with Turkey to counter the growing Iranian influence in the region (, February 3).

Bilateral economic cooperation was a major theme on Gul’s agenda. He emphasized that the two countries had already signed agreements covering tax exemption, investment protection, and transportation (ANKA, February 4) and expressed the hope that the two sides could extend this cooperation further. Turkish ministers and the businessmen accompanying Gul signed new agreements with their counterparts in such areas as educational exchange programs, cooperation in youth and sports, and maritime transportation (Hurriyet Daily News, February 4).

Gul also spoke at a meeting of the Turkish-Saudi Business Council. Noting that structural reforms in Turkey had helped the country withstand the global crisis and created favorable conditions for foreign investors, Gul highlighted the strengths of the Turkish banking system. He invited Saudi businessmen to invest in Turkey. Given Saudi Arabia’s projected investments in infrastructure, Turkish businesses, especially contractors, view Saudi Arabia as a lucrative foreign market (Cihan Haber Ajansi, February 4).

Despite the positive outlook for the economy and financial sector that Gul presented, Turkey urgently needs an injection of foreign capital to cushion the effects of the crisis. The government has been reluctant to sign a credit agreement with the IMF, because it would impose stringent conditions on government spending (EDM, January 29). There has been constant talk in Turkey about attracting petrodollars, or "Gulf capital" as the Turks like to call it, as a way to finance Turkey’s economic development. Turkish businessmen have hoped that Turkey might be able to attract Gulf capital leaving the Western banking system, especially after September 11. Lately, it has often been said that Gulf capital might make Istanbul a worldwide financial center, and end Turkey’s dependence on the IMF (Zaman, January 28, 2008). As a matter of fact, although the AKP government has been successful in boosting the volume of Arab investments in Turkey, it could not raise it to a level that would reduce Turkey’s dependence on money borrowed from Western financial institutions.

Following Prime Minister Recep Tayyip Erdogan’s walkout from a meeting in Davos, the Turkish media was full of speculative reports that Middle Eastern countries, impressed by Erdogan’s stance, were preparing to invest further in Turkey. Reportedly, financial institutions in Saudi Arabia, Kuwait, and the United Arab Emirates might offer Turkey almost a "blank check," which might relieve the Turkish economy (Yenicag, January 31). It remains to be seen, however, whether Gul can use Turkey’s new image in the Middle East and his personal ties to King Abdullah to bring home good news about Saudi investment.