The agreement was signed in Qatar on Friday by the Governor of Qatar’s Central Bank (QCB), H.E Sheikh Abdullah bin Saoud Al Thani, and the Governor of the Central Bank of the Republic of Turkey, Murat Cetinkaya.
The move paves the way for greater bilateral cooperation between the two nations, along with increased trade and investment.
The announcement comes just days after the Emir of Qatar pledged to invest $15billion in Turkey in a bid to boost Turkey’s struggling lira amid stringent sanctions from the US.
Emir Sheikh Tamim bin Hamad Al Thani held talks with Turkish President Recep Tayyip Erdogan in Ankara last Wednesday, and declared Qatar was standing by its “brothers in Turkey” after announcing its significant investment in Turkey’s banks and financial markets.
We stand by our brothers in Turkey that have stood with the issues of the Muslim world and with Qatar
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Sheikh Tamim commented on the meeting, stating: “We stand by our brothers in Turkey that have stood with the issues of the Muslim world and with Qatar.
“Today, in the framework of important negotiations with His Excellency President Erdogan in Ankara, we announced a package of deposits and investment projects worth $15billion in this country, which has a productive, strong and robust economy.”
Qatar’s Ambassador to Turkey, Salem bin Mubarak Al Shafi, also welcomed the move and stated his nation was being “proactive” in its support for Turkey.
He said: “The State of Qatar is always proactive in supporting its Turkish brothers.”
Turkey has signed a currency swap agreement with Qatar in a bid to provide liquidity (Image: GETTY)
Commenting on the Emir’s visit to Turkey, he added: “It will serve to confirm the close links between the Qatari and Turkish people and their common positions vis-a-vis the many challenges they face.”
The Turkish lira has lost nearly 40 percent against the US dollar since the start of the year, amid an ongoing diplomatic rift with the US.
The stock market has also fallen 17 percent, and inflation has hit 15 percent.
The currency nevertheless rebounded by 5.2 percent last Wednesday following the announcement of Qatar’s investment in Turkey, and was trading at around 6.0 to the US dollar.
Turkey’s financial woes worsened after President Donald Trump imposed heavy tariffs against Turkish steel and aluminium earlier this month in response to the ongoing incarceration of the US evangelical pastor Andrew Brunson, who is accused to helping to plot the 2016 coup attempt against President Erdoğan.
Commenting on the move, the US leader said: “I have just authorised a doubling of tariffs on steel and aluminium with respect to Turkey as their currency, the Turkish lira, slides rapidly downwards against our very strong dollar.
“Aluminium will now be 20 percent and steel 50 percent. Our relations with Turkey are not good at this time.”
Treasury Secretary Steven Mnuchin also declared last Thursday that the US is prepared to implement additional sanctions if Mr Brunson is not released.
The Emir of Qatar pledged to invest $15billion in Turkey following a meeting with President Erdogan (Image: REUTERS)
Donald Trump accused Turkey of ‘taking advantage’ of the US for numerous years (Image: GETTY)
Speaking to President Trump during the cabinet meeting, Mr Mnuchin said: “We’ve put sanctions on several of their cabinet members, working with you (President Trump), we have more that we’re planning to do if they don’t release him quickly.”
President Trump has expressed direct criticism of Turkey, accusing the Turkish government of “taking advantage” of the US, and branding Andrew Brunson an “innocent man”.
Writing on Twitter, President Trump said: “Turkey has taken advantage of the United States for many years.
“They are now holding our wonderful Christian pastor, who I must now ask to represent our country as a great patriot hostage.
Qatar has vowed to ‘stand by our brothers in Turkey’ in response to US sanctions (Image: GETTY)
“We will pay nothing of the release of an innocent man, but we are cutting back on Turkey!”
Turkey has nevertheless responded sharply by implementing a series of tariffs on a raft of US goods.
The decree, which was signed by President Erdoğan, raised tariffs on alcoholic beverages by 140 percent, on tobacco by 60 percent, and on passenger cars by 120 percent.
Tariffs were also implemented on other US goods, including cosmetics, rice and coal.
President Erdogan has stated Turkey ‘will not surrender’ to US demands (Image: GETTY)
Turkey’s Vice President Fuat Oktay commented on the move, stating: “Under the principle of reciprocity, the tax rates for imports of certain products have been increased against the US administration’s conscious attacks on our economy.”
President Erdogan also responded defiantly to President Trump’s threats in a speech in the Black Sea city of Trabzon earlier this month.
He said: “I want them to know that we will not surrender. We will keep producing and we will keep increasing exports.
“We will not give in, if you come at us with your dollars then we will find other ways to do business.
“The US is sacrificing its 81-million strong ally Turkey for a pastor with links to terrorists.”