UAE, Turkey Strengthen Economic Ties with Currency Swap and MoUs
The United Arab Emirates (UAE) and Turkey have taken significant steps to strengthen their economic ties. The two nations have signed a currency swap agreement and memoranda of understanding (MoUs), paving the way for enhanced trade, investment, and financial technology cooperation.
The currency swap deal, valued at AED 18 billion and TRY 198 billion, aims to boost bilateral trade and provide liquidity in both currencies. This will make transactions more efficient and cost-effective.
Two MoUs have been established to promote the use of local currencies in cross-border transactions. The first focuses on encouraging the use of the dirham and lira for settlements. The second MoU is centered around linking payment and messaging systems between the UAE and Turkey. This includes integrating instant payment platforms and exploring the use of central bank digital currencies.
CBRT Governor Fatih Karahan noted that these deals open up new opportunities in trade, investment, and financial technology. CBUAE Governor Khaled Mohamed Balama highlighted the benefits of local currency use in lowering costs and improving settlement times.
The UAE and Turkey are moving closer to deepening their economic ties. These agreements, while not specifying the involved banks or individuals, signal a commitment to modernizing cross-border payment systems and expanding local currency use in international commerce.
