UNCTAD: Positive trend in Turkish economy related to Azerbaijan’s SOCAR

The positive trend in Turkiye in 2021 was propelled by the refinancing of project debt across several oil and gas assets in Turkiye by SOCAR, based in Azerbaijan, according to the UNCTAD’s World Investment Report 2022, Report informs.

Foreign direct investment in the Turkish economy grew by 60% to $13 billion in 2021, while the last two years have seen a decline.

West Asia recorded a 59% increase in FDI flows to $55 billion.

The United Arab Emirates remained the largest recipient, with flows stable at $20 billion, inflows more than tripled in Saudi Arabia to $19 billion.

The State Oil Company of Azerbaijan (SOCAR) established a subsidiary “SOCAR Turkey” in Turkiye in late 2006. The company was established in Turkiye to implement projects in the field of oil refining and petrochemistry, to trade in natural gas. SOCAR Turkey owns a controlling stake (51%) in the neighboring country’s Petkim Petrokimya Holding, a petrochemical complex.

Petkim PetroKimya Holding A.S. is the biggest asset of SOCAR in Turkiye. In 2018, the STAR oil refinery, SOCAR’s Turkish Aegean refinery, was commissioned by SOCAR with an investment of $6.3 billion. Petkim Limancilik Ticaret A.S., a subsidiary of Petkim, is one of the three largest ports in Turkiye with an annual capacity of 1.5 million TEU, and about $400 million has been invested in the terminal.

An important project implemented by SOCAR in the field of renewable energy, PETKIM Wind Power Plant has a capacity of 51 MW and an investment of 55 million euros. The plant will also make an important contribution to meeting SOCAR’s energy needs in Aliaga, depending on Turkiye’s overall energy system.

SOCAR Turkey Energy has so far invested $16.5 billion in Turkiye and is negotiating new investments, mainly in the petrochemical and gas sectors.