Saudi Arabia has agreed to contribute $5 billion to Turkey’s central bank through the Saudi Development Fund, the fund said in a statement on Monday, a decision that is “a demonstration of the Kingdom of Saudi Arabia’s commitment to supporting Turkey’s efforts to strengthen its economy.” reports CNBC.

The news comes as Turkey struggles with an economy battered by years of high inflation and a recent series of devastating earthquakes that have killed more than 46,000 people and left millions homeless.

Inflation in Turkey is still above 55% and its currency is near record lows against the dollar after years of political intervention by Turkish President Recep Tayyip Erdogan, who has resisted raising interest rates despite rising inflation.

Higher global energy prices, the Covid-19 pandemic and Turkey’s growing current account and trade deficits have also combined to put the Turkish economy in a precarious position, and many of the country’s 85 million citizens can now barely afford basic goods. .

The move by Saudi Arabia marks a further improvement in relations between the two countries – both major powers of the Muslim world – after ties were almost severed following the killing of journalist Jamal Khashoggi by Saudi agents at the Saudi consulate in Istanbul.

Since then, countries have used various means to unofficially boycott their products and flights or block their media.

But during 2022, the leaders of Turkey and Saudi Arabia made diplomatic visits to each other and pledged trade and investment, as Erdogan embraced a complete shift in his stance, seeking rapprochement and financial support for his country’s struggling economy.