Turkey is actively seeking more investments from the United Arab Emirates (UAE) in the field of artificial intelligence (AI) as the two countries strengthen their bilateral ties. Burak Daglioglu, the president of the Investment Office of the Presidency of Turkey, stated, “The UAE is positioning [itself] as a hub for AI investments and we see a similar potential for Turkey. There are tangible outcomes already and there will be more,” during a press conference in Istanbul on Wednesday.

Daglioglu emphasized that Turkey has a robust pipeline of infrastructure projects, which includes data centers, connectivity, and renewable energy capacity, aimed at attracting investments in AI. He noted that there have been several investment agreements across various sectors, including technology, finance, manufacturing, and infrastructure development.

This week, Dubai Islamic Bank signed a significant $150 million sharia-compliant financing agreement with Turkcell, Turkey’s telecom and technology services provider. This deal is designed to support Turkcell’s ongoing investments in digital infrastructure, with a focus on critical areas such as data centers, cloud technologies, and renewable energy.

In addition to this, last month, G42’s Khazna announced plans for an AI-capable data center in Turkey, which will have a potential capacity of up to 100 megawatts. The Abu Dhabi-based company secured a site in Ankara and intends to further invest in Turkey, expanding its data center network following the completion of the new facility.

Turkey is also looking to attract UAE investments in additional sectors such as HealthTech, renewable energy, and manufacturing, according to Daglioglu. He pointed out that the UAE’s non-oil trade with Turkey grew by 11.5 percent on an annual basis, reaching Dh148.9 billion ($40.54 billion) last year, based on official data.

Daglioglu highlighted the importance of the free trade agreement between the two countries, stating, “The most important development in the recent years was the free trade agreement between the two countries because it paved the way for a larger trade volume.” He further noted that this agreement has increased investment opportunities, predicting that the investment pipeline from the UAE to Turkey will continue to grow.

The trend is mutual; Turkish companies have also started to invest in the UAE following the free trade agreement. Last year, UAE investments in Turkey totaled $307 million, while Turkey’s investments in the UAE reached $576 million, according to the Turkey Investment Office.

Since 2002, the UAE has invested approximately $5.9 billion in Turkey, while Turkey’s investments in the UAE during the same period amounted to $2.4 billion. By mid-2022, there were 604 Emirati companies operating in Turkey.

Looking ahead, Daglioglu mentioned that Turkey’s economy is projected to grow by 2.7 percent this year, and the country is focusing on enhancing its start-up ecosystem. New legislations have been introduced to support start-ups with funding and to encourage sovereign wealth funds to invest.

He stated, “We have successful start-ups, not focusing on exits … the previous trend was to make an exit to a larger local player. Now, Turkish companies are becoming regional players.” Last year, Abu Dhabi’s holding company ADQ and the Turkey Wealth Fund established a new $300 million technology fund aimed at investing in Turkish start-ups, targeting sectors such as energy and utilities, healthcare, life sciences, food and agriculture, mobility and logistics, financial services, and education.