Saudi Arabia to deposit $5 billion in Turkey after earthquake
Turkey is experiencing a shortage of foreign currency amid its economic crisis and is looking to the Gulf for help.
Saudi Arabia agreed on Monday to deposit $5 billion in Turkey’s Central Bank, following the devastating earthquakes that hit the country last month.
“This deposit is a testament to the close cooperation and historical ties that exist between the Kingdom of Saudi Arabia and the Republic of Turkey and its brotherly people,” the Saudi Fund for Development said in a statement.
Deposits by foreign governments in other countries' central banks typically allow the depositor to earn interest and are treated as loans. The fund did not provide specifics on the arrangement.
Why it matters: Turkey has been experiencing a shortage of foreign currency reserves since 2018. The situation grew worse in 2022 due to the surging commodity and energy prices resulting from the Russian invasion of Ukrain, hitting Turkey especially hard as the country is heavily dependent on imports.
