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Turkey inks $12bn energy project with UAE

January 04, 2013

The image shows a Turkish flag. — File photo

ANKARA, Jan 3: Turkey tied up a giant agreement with the United Arab Emirates on Thursday for the development of coal fields in southern Turkey to generate electricity and ensure power for the fast-growing economy.

The deal to exploit the coal reserves is a new signal of the rise of the Turkish economy and of wider links between Turkey and the Middle East. The agreement between Abu Dhabi-based TAQA and Turkey’s state-run power company EUAS marks the biggest Arab investment in the Turkish energy sector, a senior energy ministry official told AFP.

“This is a very serious investment, a significant investment,” Turkish Energy Minister Taner Yildiz said at the signing ceremony in Ankara.

“This is the second-biggest investment made in Turkey after the two nuclear power plant projects,” he added. The government plans to build three nuclear power plants in hopes of preventing a possible energy shortage and reducing dependence on foreign energy supplies.

It struck a deal with Russia in 2010 to build the country’s first power plant at Akkuyu in southern Turkey and is in negotiations with China, Japan, South Korea and Canada to build the second nuclear reactor in Black Sea region. With the latest agreement, the coal reserves at Afsin-Elbistan basin in southern Turkey will be put to use for electricity production.

Over the last decade, Turkey’s Islamic-rooted Justice and Development Party (AKP) government has boasted of major success in transforming the economy after a devastating meltdown in 2001 and has introduced strict budgetary discipline under International Monetary Fund programmes. The country achieved record growth rates exceeding 8.0 per cent in 2010 and 2011.

Turkey has also cultivated good neighbour relations with the Arab world and gained access to Middle Eastern investors and markets.

“The Turkish economy has been doing very well over the years... because you have a good investment climate.—AFP