Turkish investments in Saudi Arabia set to exceed records in 2024

Over 200 Turkish companies have invested in Saudi Arabia, projecting a $20 billion share in the Vision 2030 plan, according to the Türkiye-Saudi Arabia Business Council under the Foreign Economic Relations Board (DEIK).

Turkish contractors secured the highest number of international projects in Saudi Arabia during the first nine months of 2024, with a total of $2.3 billion in contracts, including giant Turkish companies’ investments such as Limak, TAV, IC Ictas, Kuzu, Mapa, Kolin and Tekfen, as per data from the Turkish Contractors Association (TMB).

‘We aim for cooperation in energy sector’

In an interview with German-based DW Turkce, Hasim Sungu, President of the Türkiye-Saudi Arabia Business Council, emphasized that Turkish companies are leading in mega projects, particularly in the infrastructure and construction sectors.

“These investments contribute to the labor markets of both countries,” he said.

Highlighting the strategic importance of energy cooperation between the two countries, Sungu added: “In addition to Saudi Arabia’s experience in the oil and natural gas sectors, its interest in renewable energy, combined with Türkiye’s expertise in this field, brings solar and wind energy projects to the forefront. Joint projects between the two nations aim to contribute to energy security and increase renewable resources.”

‘Largest bridge project in Saudi Arabia’

IC Ictas Insaat, a subsidiary of IC Holding and one of the companies aiming to grow its presence in Saudi Arabia, won the tender for the country’s largest bridge project, Wadi Laban.

Ilker Oksuz, Executive Board Member of IC Ictas Insaat, well-known for projects like the Akkuyu Nuclear Power Plant, Yavuz Sultan Selim Bridge and the Northern Marmara Highway in Türkiye, stated they completed the construction of a terminal at King Khalid International Airport in Riyadh with an investment of approximately $1.5 billion.

Following the airport investment, Oksuz highlighted that they won another significant tender in the country, a two-cable-stayed bridge project 763 meters long, 167 meters high, and 36 meters wide, with six lanes of traffic flow, worth a $500 million project, aiming to finish in 36 months.

Oksuz noted IC Ictas Insaat also plans to bid for the ski facility tender for the 2029 Winter Olympics in Saudi Arabia. Limak Holding, on the other hand, has taken on three tourism projects in the country, valued at a total of $1.5 billion.

‘Turkish products in high demand’

Turkish exports to Saudi Arabia reached a record high of $2.9 billion during the January-September period of 2024, according to data from the Turkish Statistical Institute (TurkStat).

The data shows machinery, carpets and furniture lead the way in exports, while plastics and organic chemicals top the list of imports.

Bulent Aymen, Vice President of the Mediterranean Furniture, Paper, and Forestry Products Exporters Association, pointed out the rapid growth of trade with Saudi Arabia, referring to eight Hatay-based companies holding over 290 bilateral meetings with 70 Saudi companies during the “Hatay Furniture and Accessories URGE Project” in Riyadh from Nov. 4-7.

“We are increasing our exports to Saudi Arabia by almost 80% every month. We constantly hold exhibitions and meetings, especially in the furniture and contracting sectors. There is significant interest in Turkish products in Saudi Arabia,” Aymen said.

Aymen added the Saudi market offers substantial opportunities for the Turkish furniture sector, similar to many other industries: “Saudi Arabia, with an import volume exceeding $4 billion in this sector, is a major buyer globally. We are the third-largest supplier after China and Italy, which points to even greater growth potential for us.”

‘Türkiye needs strategic plan for Saudi Arabia’s investments’

Eyup Vural Aydin, a consultant for the National Privatization and Public-Private Partnership Center (NCP) established in Saudi Arabia in 2017, mentioned the duration of this renewed period of trade and investment between the two nations remains a topic of interest. Türkiye needs a “strategic plan” to secure a larger share of the Saudi Arabian market, which is increasingly opening up to the world, Aydin stated.

Aydin underscored Saudi Arabia still does not accept letters of guarantee from Turkish banks and that the market is highly competitive, led by U.S., Chinese and French firms.

“Yes, there are immense opportunities, and significant doors are opening. However, it would be far better if Turkish companies and public authorities worked together according to a plan. For example, just three months ago, China signed a $50 billion investment deal with Saudi Arabia. Türkiye also needs to take similar steps,” Aydin concluded.

Saudi Arabia’s Vision 2030 represents $1 trillion investment

Türkiye’s exports to Saudi Arabia nearly halted in 2021, dropping to just $265,000 in the wake of the Khashoggi crisis, while Saudi imports remained steady.

In 2022, renewed ties between President Recep Tayyip Erdoğan and Crown Prince Mohammed bin Salman revitalized trade. By the end of that year, Turkish exports to Saudi Arabia surged 450% to $1.5 billion, climbing further to $2.6 billion by 2023.

Turkish companies have since secured infrastructure and superstructure contracts worth around $10 billion. President Recep Tayyip Erdogan’s visit to Saudi Arabia on Nov. 11 underscored these strengthening ties, reflected in rising bilateral trade.

Saudi Arabia’s Vision 2030 plan, targeting $1 trillion in investments, aims to attract 100 million tourists annually, driving demand for infrastructure and superstructure projects across 12 cities to boost quality of life and economic growth.