ANKARA, Nov 25 (Reuters) – Turkey and Qatar are in the final stages of Doha talks to provide up to $10 billion in funding to Ankara, including up to $3 billion by the end of this year, two senior Turkish officials and another source told Reuters.
One of the officials said the full funding could come in the form of a swap, a Eurobond or some other method, and Turkish and Qatari leaders had discussed the matter.
Foreign financing could help bolster foreign exchange reserves to support President Tayyip Erdogan’s unorthodox policy of continuing interest rate cuts and other stimulus despite soaring inflation and collapsing global currency. read it.
The Turkish Treasury was not immediately available for comment. Qatari officials did not immediately respond to a request for comment.
While Western countries are reluctant to invest in Turkey, Ankara has turned to “friendly” countries for foreign resources to support its policy of supporting the lira by balancing supply and demand for foreign currencies. economy.
Turkey’s central bank previously had a swap deal in place with Qatar’s central bank that was originally worth $5 billion, but tripled in 2020 to $15 billion.
The sources spoke on condition of anonymity as they were not authorized to discuss the funding.
“The talks for Qatar to provide new resources to Turkey have reached the final stage. A minimum amount of $8 billion is expected,” but it could total up to $10 billion, the first official said.
“Resources will be secured, with $2-3 billion by the end of this year (and) the rest to come next year. It could be a swap or a Eurobond, but they are discussing several methods . There is a mutual agreement,” the person said. added.
The second Turkish official said talks for $2-3 billion in funding for this year were focused on the Eurobond.
Qatar has close ties with Turkey, which supported Doha when Saudi Arabia, the United Arab Emirates and two other Arab states imposed an embargo on Qatar in 2017 in a streak that was resolved early in the year. last year.
Erdogan was in Qatar for the opening match of the FIFA World Cup on Sunday, while Turkish Finance Minister Nureddin Nebati met his Qatari counterpart Ali bin Ahmed al-Kuwari last month.
Turkey’s finance ministry has borrowed $9 billion in 2022, out of the $11 billion in foreign borrowing planned for the year.
The ministry plans foreign borrowing of $10 billion for 2023, but it can advance its debt issuances if needed for earlier funding.
Ankara already has a total of $28 billion in currency swap deals with the United Arab Emirates, China, Qatar and South Korea and bankers calculate that around $23-24 billion is already in the reserves of the Turkish central bank.
Turkey is also in the final stages of talks with Saudi Arabia over placing a $5 billion deposit in Riyadh with the Turkish Central Bank, a Saudi finance ministry spokesman said on Tuesday. Turkey’s central bank declined to comment on the matter.
Instead of swap agreements, Turkey’s central bank recently preferred deposit accounts, which involve dollars or euros entering the system instead of local currencies.
Written by Ali Kucukgocmen; Editing by Jonathan Spicer and Gareth Jones
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