Turkey recently signed the biggest defence contract – through a drone agreement – in its history. And it signed it with Saudi Arabia, a nation with which it does not traditionally have good relations.
Both because of conflicting views on political-Islamist organisations, and because of the case of the murder of Saudi journalist Jamal Khashoggi in Istanbul in 2018.
However, these ideological differences have been put aside – already for a couple of years. In fact – because Turkey needs to reinvigorate its ailing economy and Arab money comes in handy.
This is the underlying objective of Turkish President Recep Tayyip Erdogan‘s trip to the Gulf region.
Last May, Turkey’s budget deficit amounted to $37.7 billion, a record. The deficit has been made up mainly with currency reserves, explains the Financial Times.
But the authorities would prefer to make up for it with inflows of foreign investment. Instead, the inflation rate is around 40 per cent. And so far this year the lira (the national currency) has lost almost 29 per cent.
What we know about the drone agreement
The deal concerns the Bayraktar Akinci drone, but the economic value was not made explicit.
Baykar CEO Haluk Bayraktar, however, said that it is the largest export contract on defence and aviation in Turkish history.
The president of Baykar, Selçuk Bayraktar, is Erdogan’s son-in-law.
Saudi Arabia’s targets
Saudi Defence Minister Khalid bin Salman commented on the drone deal saying that Riyadh will be able to ‘improve the readiness of the armed forces […] and strengthen its defence and production capabilities’.
Indeed, the agreement also provides for technology transfers and joint production of the drones ‘in order to advance the advanced technology development capability of the two countries’.
Saudi Arabia is seeking to develop a national defence industry as part of a vast economic diversification programme implemented by Mohammed bin Salman to reduce dependence on oil revenues.