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Turkish Gold Exports to Iran Still Surging |
15 September 2012by Dorian Jones, VOA News
ISTANBUL--In the past few months, there has been a surge in Turkey's gold exports to Iran. Questions are increasing over whether the gold purchases are the latest attempt by Tehran to circumvent increasingly tough international sanctions.
Throughout 2012, Turkish-Iranian trade has experienced record monthly increases. Most is due to gold exports to Iran.
Inan Demir, Turkish Finansbank chief economist said the amounts are unprecedented.
"In 2010 and 2011 combined Turkey's total gold and jewelry exports amounted to $4.3 billion," said Demir. "Now, in the first six months of 2012, gold exports to Iran, we are talking about a gold export figure in excess of $6 billion. So, compared to past trends, we are definitely talking something extraordinary here."
The deteriorating Iranian economy, as a result of tightening international economic sanctions over Tehran's nuclear-energy program, is seen as a key factor behind the surge in gold exports.
Iran analyst Jamshid Assadi, of France’s Burgundy Business School, said he suspects Iran's government is seeking to exploit growing public demand for gold as a result of rising inflation and the falling value of the Iranian currency.
"They want to make some money. They know that people buy euros, like dollar, like gold. They buy gold in other countries and they sell it to the Iranian citizens more expensive, and they make money, they badly need money, and they do what they could to make money," said Assadi.
The introduction this year of new European Union and U.S. sanctions on Iran’s banking system is making it increasingly difficult for customers to pay for Iran’s energy. Finansbank economist Demir said paying in gold could be a solution.
"This seemed to be way of circumventing these sanctions on the banking system of Iran. Iran has to conduct its energy trade through intermediaries, because its banking system is shut out from the rest of the world," said Demir. "Energy importers from Iran pay hard currencies to these intermediaries, but since these intermediaries can not transfer these funds to Iran directly, maybe, my understanding, they could be purchasing gold and then shipping it to Iran."
Turkish Energy Minister Taner Yildiz denied recent reports that Ankara was paying for its Iranian energy imports in gold. Those imports spiked in August after hitting a multi-year low in July, as Turkey sought to comply with U.S. sanctions.
The EU has introduced a ban on exports of gold to Iran, but Turkey is not an EU member and says it is not bound by the measures. Last month, U.S. Under Secretary for Terrorism and Financial Intelligence David Cohen visited Istanbul for talks on the enforcement of Iranian sanctions.
The surge in gold exports also has been matched by a similarly impressive growth in Iranian businesses opening in Turkey.
"The number of the Iranian businesses opened in Turkey in the last two years is outnumbering the number of businesses opened by European countries altogether," said Kerem Balci of the Turkish newspaper Today’s Zaman. "On the other hand, the amount of money that is coming into Turkey from European investors is about 100 times more than the Iranian money. This says they are not here just to make business. There may be possibilities that some of the Iranians are planning to use those companies in order overcome the problems that are being created by the international sanctions."
Turkey borders Iran and is one of the few countries Iranians do not need a visa to visit. That helps to make it attractive to Iranians to set up businesses and conduct trade. Observers point out the growing Iranian business presence and booming gold trade makes Turkey likely to face growing scrutiny from Brussels and Washington as they continue sanctions against Tehran. |
15 September 2012
VOA News
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