Industrial cities to host 4IR as Saudi Arabia diversifies away from oil

Turkey seeks partnership with Saudi Arabia as it plans to be an energy hub for Europe, minister tells Arab News

RIYADH: Turkey is seeking more cooperation with Saudi Arabia and other countries as it plans to be an energy hub for Europe, its finance minister has said.

“Turkey, due to its geographical position, is an energy corridor between Russia, Iran and Saudi Arabia. Any type of natural gas or oil that is going to be transported or shipped will cost less and will be shipped more safely,” Arab News said in an interview.

Speaking on the sidelines of the 6th edition of the Future Investment Initiative forum in Riyadh, the minister did not specify how the two countries could cooperate, but said that peace in the region would reduce energy costs.

“Turkey and Saudi Arabia are also helping each other, which will bring peace to the region. This peace will bring more affordable gas prices, energy prices, and allow both countries to look to the future “, he added.

Saudi Arabia is the largest oil exporter in the world. Its gas reserves stand at nearly 300 trillion cubic feet, making it the fifth largest gas reserve in the world. However, the Kingdom does not export gas and it intends to increase production to meet local demand and eliminate the use of oil and other liquids in power generation.

Saudi Commerce Minister Majed Al-Qasabi estimated that Saudi investments in Turkey would total $18 billion, and he expects to see around $3-5 billion in new investments in the coming period. (Reuters)

Nebati’s comments come a week after Turkish President Recep Tayyip Erdogan said he had agreed with his Russian counterpart Vladimir Putin to form a natural gas hub in Turkey.

Addressing members of his AK party in parliament on October 19, Erdogan said Putin had said Europe could source gas from the hub in Turkey.

“When we look at Europe, they are dependent on Russian gas and they will go through the winter with enormous stress. It is obvious, and new steps and new structuring must be taken,” Nebati added.

“And that is why our President Erdogan said that Turkey, which will become a hub, should take the necessary measures for the distribution of Iranian gas or Russian gas to Europe. And this will help bring peace to the region and create a secure environment for this cargo,” he added.

Nebati, who held several meetings with Saudi officials during his visit, including finance and trade ministers, said the measures taken by Turkey will help reduce the cost of energy by lowering the cost of transport. .

“This will lead to the solution of high prices, which puts the world in the face of recession. And in this sense, it is good to interpret this as Turkey being ready to take all the responsibilities as our president said to take a step to comfort the whole world, especially Europe in this gas challenge”, did he declare.

Saudi Arabia is also increasing its oil exports to Europe, the country’s energy minister, Prince Abdulaziz bin Salman, said at the same event in Riyadh.
He said shipments in September nearly doubled from a month ago, reaching 950,000 barrels per day.

Turkey’s finance minister said his country has a natural gas production strategy.

“As you know, in the Black Sea we have found natural gas and we have a large reserve. In the coming months, we will start using this natural gas,” he said.

Saudi-Turkish cooperation Nebati said his country is trying to expand economic cooperation with Saudi Arabia, which will benefit the region.

“In the coming period, the cooperation between Saudi Arabia and Turkey will, of course, trigger new areas of cooperation and with the vision of Saudi Arabia and
Turkey’s vision for 2023, we will enter a new century and help bring peace and prosperity to the region,” he added.

He added that Turkey supports the Kingdom’s bid to host Expo 2030 and that the two countries stand together against terrorism.

Speaking to TRT last week, Saudi Commerce Minister Majed Al-Qasabi said he estimated Saudi investment in Turkey at a total of $18 billion and expected to see approximately $3-5 billion in new investments over the coming period.

Nebati said the recent exchange of visits between the Turkish President and Saudi Crown Prince Mohammad bin Salman “will be beneficial for both parties” and as a result investments, trade relations and the volume of trade in both directions will increase. .

Turkish economic growth

Turkey’s economy grew by 7.6% on an annual basis in the second quarter of 2022, leading to GDP growth of 7.5% in the first half of the year. Last year, the economy grew by 11.8%, according to official figures.

“When you look at this growth, it has happened through internal trade, external trade and balanced growth. It shows the internal potential of catering to a younger population and being a hub of production and manufacturing,”

Nebati explained. The Turkish economic model is based on investment, productivity and employment, and in the coming period with falling commodity prices and energy prices, “this will help balance the deficit current, and this will allow Turkey to solve all the challenges that we have experienced since last year,” he added.

Turkey’s economic growth has been supported by huge investments in infrastructure over the past two decades, he said.

Turkey and Saudi Arabia are also helping each other, which will bring peace to the region.

This peace will bring more affordable gas prices, energy prices, and allow both countries to look to the future.

“We have built huge infrastructure such as railways, highways, airports and seaports. We have completed all our infrastructure, including investments in hospitals and education, from primary schools to universities. »

The level of localization in the Turkish economy is high, reaching 80% in the defense industry, where in the past it was around 20%, he added.

Turkish inflation

Nebati expects this growth to continue, but admits rising inflation and fluctuating exchange rates remain a challenge.

He said inflation in Turkey rose because commodity prices from last year rose along with shipping costs, transport costs and energy prices.

“But in the fight against inflation, we focused on human beings. We wanted to grow. We don’t want people losing their jobs as we continue our manufacturing and productivity.

“We are not stepping on the brake too much and we want to solve this problem slowly, and we are lucky because the pressure on energy prices is easing,” he added.

“We don’t perceive inflation as in the world. We see it in a human approach. We don’t want people to lose their jobs. And we will make every effort to ensure that they do not lose their jobs.

Nebati expects inflation to slow from December, and for next year, “we will have the target level of 25% inflation. And as I said, we are acting decisively to solve this problem.

Prices for agricultural products have fallen and the effect of inflation “due to last year’s currency attacks has also slowed”, he added.

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