Egyptian-Turkish business relations in 2024: A new era of cooperation

In recent years, the diplomatic and economic ties between Egypt and Turkey have undergone a remarkable transformation. After nearly a decade of strained relations, marked by political and ideological conflicts, both countries have made significant strides in rebuilding their partnership. The visit of President Recep Tayyip Erdogan to Egypt in February 2024 marked a turning point, symbolizing a new chapter in Egyptian-Turkish business and trade relations.

Historical context

The friction between Egypt and Turkey can be traced back to the political upheavals in the region following the 2011 Arab uprisings. The divergence in their political stances became evident when Turkey, under Erdogan, supported the Muslim Brotherhood and condemned the military coup that brought Abdel-Fattah el-Sisi to power in Egypt. This resulted in a severe diplomatic fallout, with both nations downgrading their ties and finding themselves on opposite sides in various regional conflicts, including the Libyan civil war.

Reconciliation and economic revival

The easing of tensions began in earnest in 2021, with both countries recognizing the mutual benefits of cooperation. By 2023, the trade volume between Egypt and Turkey had reached $5.875 billion, showcasing a substantial recovery and growth from previous years. This resurgence in trade is a testament to the robust economic foundations that both nations share.

Egyptian Trade Minister Ahmed Samir highlighted the significant increase in Egyptian exports to Turkey, which grew by 28% to $2.934 billion in 2023. Major exports included chemical products, fertilizers, building materials, textiles, electronic and engineering goods, ready-made garments, and agricultural products. Concurrently, the value of imports from Turkey saw a noticeable decline, reducing the trade deficit significantly.

Strategic investments

Turkish investments in Egypt have also seen a substantial increase, surpassing $3 billion. These investments have created approximately 70,000 direct jobs and an additional 100,000 indirect jobs. Key sectors attracting Turkish capital include textiles, ready-made garments, chemicals, glass products, and recycling. Turkish companies have played a crucial role in enhancing Egypt's industrial capabilities and export potential, contributing significantly to the country's economic growth.

Future prospects

The establishment of a new industrial zone by the Bursa Chamber of Commerce and Industry in Egypt aims to further bolster economic ties. This zone will focus on various sectors, including textiles, automobiles, machinery, and advanced technologies, leveraging Egypt's strategic location and trade agreements with major global markets.

Yunus Turk, Chairperson of the Türkiye-Egypt Business Council, expressed optimism about the future of bilateral trade, projecting that the trade volume could reach $15 billion to $20 billion within the next five years. The positive image of Turkish products in Egypt, coupled with the country's large market of 115 million people, provides a solid foundation for this optimistic outlook.

Sectoral shifts and new opportunities

The Turkish textile and apparel sector is particularly keen on expanding operations in Egypt, driven by lower energy and labor costs, as well as favorable economic reforms. This shift is expected to enhance Egypt's position as a hub for textile exports, benefiting from both Turkish expertise and local competitive advantages.

Moreover, the strategic partnership between Egypt and Turkey extends beyond trade. The Turkish Ambassador to Egypt, Salih Mutlu Şen, emphasized the importance of this collaboration for accessing African, European, and other international markets. Turkish companies, such as Beko, have already established significant operations in Egypt, exporting a large portion of their products to foreign markets.

Conclusion

The renewed Egyptian-Turkish business relations signal a promising future for both countries. As they continue to strengthen their economic ties, the focus will be on enhancing trade volumes, increasing investments, and exploring new sectors for collaboration. This partnership not only benefits Egypt and Turkey but also contributes to regional stability and economic growth, marking a new era of cooperation in the Middle East and beyond.