The Turkish army pension fund OYAK signed a deal on Thursday with the Oman Investment Authority (OIA) to set up a $500 million joint investment fund that the sides say is aimed at strengthening economic relations and expanding international reach.

The agreement was announced at a joint news conference in Ankara with President Recep Tayyip Erdoğan and Oman's Sultan Haitham bin Tariq Al Said.

Both parties will contribute $250 million each to the fund, which will support investments in Türkiye, Oman, and potentially other countries, according to a statement from OYAK.

The inaugural investment of the new fund will be earmarked for a new container port in Iskenderun in southern Türkiye's Hatay province.

OYAK General Manager Süleyman Savaş Erdem said the new fund aims to provide sustainable returns to its members.

"With this fund, we will be making investments in strategic areas not only in both countries, but also in different regions of the world," said Erdem.

"Our priorities include increasing our foreign income and raising our country's export rate by seizing growth opportunities and expanding into new markets."

Abdulsalam bin Mohammed Al Murshidi, president of the Oman Investment Authority, said collaboration with OYAK "seamlessly aligns with our strategic objectives to expand our investment network and secure meaningful returns."

OIA Chief Investment Officer Ibrahim El Eisri said the fund’s first project will be the Southern Container Port in Iskenderun.

"The new port in Iskenderun will meet the entire region's needs and serve as a gateway to global investments for OYAK's partner, Oman Investment Authority," said El Eisri.

"We plan to make investments together in different geographies in the world."

Key industries targeted for investment include mining, metals, automotive manufacturing, logistics, chemicals, agriculture, food production, and energy.

The fund also aims to facilitate technology transfer and localize expertise in Oman, fostering capacity building and knowledge sharing, OIA's statement said.

OYAK was set up in 1961, a year after the first military coup in modern Türkiye. Its total assets stood at around TL 847 billion (over $24.4 billion) as of the end of 2023.

It is active in the mining, cement, automotive, finance, chemistry, metallurgy and energy sectors.

Formed in 2020 through the merger of the State General Reserve Fund and the Oman Investment Fund, the Oman Investment Authority holds assets worth $51 billion as of 2023.

The authority has investments across more than 50 countries in sectors such as industry, aviation, energy, mining, logistics, tourism, financial services, information and technology, food and fisheries.