New investment fund set to strengthen ties between Russia and Turkey
The flourishing political and economic alliance between Russia and Turkey wracked up a notch this week with the announcement that the two countries had now formally agreed to set up a joint Russia-Turkey Investment Fund.
The two signatories to the agreement – the Russian Direct Investment Fund (RDIF) and the Türkiye Wealth Fund (TWF) – have agreed to sink $500m each into the new investment vehicle whose remit will be to identify and then develop projects that could strengthen bilateral economic ties and increase investment flows between the two countries.
“We are pleased that business activity gives impetus to the development of Russian-Turkish relations,” RDIF CEO Kirill Dmitriev said after the signing. “We are already in talks concerning a number of potential joint investment projects.”
The agreement comes hard on the heels of the ratification by Presidents Putin and Erdogan of the construction of the Turkish Stream gas pipeline along the bed of the Black Sea, and the two countries are already collaborating on the construction of the $20bn Akkuyu nuclear power plant which is due to start operating in 2023.
One likely beneficiary of the new agreement could be Moscow’s plans for a 7,000 km Black Sea ‘ring highway’ that it sees as a catalyst for increased trade, tourism and and transportation investment among the member states of the Organization of the Black Sea Economic Cooperation, some 500km of which would run through Turkey. In a speech last year, Turkey’s Prime Minister Binali Yildirim also alluded to possibility of greater collaboration in the fields of agriculture and infrastructure.