The Central Banks of Turkey and the United Arab Emirates (UAE) have announced that they have signed three agreements for cooperation – further enhancing trade and economic ties between the two countries.
Three agreements between Turkey and the UAE
The three agreements include a bilateral currency swap between the Turkish Lira and the UAE Dirham. The swap agreement totals 198 billion Turkish Lira and 18 billion UAE Dirhams – amounting to around $4.9 billion USD mutually.
The other two agreements are memorandums of understanding signed between the two banks, including the following: 1 – The promotion of local currencies for cross-border transactions, and, 2 – The interlinking of their payment and messaging systems.
In a written statement about the agreements, the Central Bank of Turkey (CBRT) said: “These agreements aim at promoting financial and economic collaboration and strengthening bilateral trade.”
Memorandums of understanding
The first promise aims to establish the use of the Turkish Lira and UAE Dirham in cross-border transaction settlements. The goals of this pact include the expansion of the foreign currency market – improving stability and economic progress in both countries.
The second promise aims to increase the use of domestic payment cards and make it easier for payments and transactions to be made between the two countries. The sharing of data and integration of the UAE’s Instant Payment Platform and Turkey’s FAST system would improve the effectiveness of cross-border transactions.
Fatih Karahan, the governor of the Turkish Central Bank, said: “These agreements reflect the shared commitment of both parties to advancing financial cooperation. The agreements open up new opportunities to facilitate trade and investment relations.”
Supporting the efforts of both countries
The governor of the UAE Central Bank, Khaled Mohamed Balama, also reflected on the commitment of both banks to work together, saying: “The agreements signed reflect the commitment to work together in supporting the efforts of both nations to further strengthen their strategic partnership to new heights.”
Balama noted that there is lots of potential for the UAE and Turkey to work together in areas including finance, financial technology, and cross-border digital payments.
Cameron Deggin 
Founder & CEO, Property Turkey
Cameron Deggin is Founder and CEO of Property Turkey. A former finance professional and FCCA-qualified accountant, he founded the company in 2001 after recognising Turkey’s investment potential. With more than two decades analysing Turkish real estate, Cameron regularly advises international investors and is quoted by media including the Financial Times and BBC.
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