Friday, April 26th 03:38 PM IST

Gold accounts for 9% of Turkey exports to MENA

# Turkey gold  # gold exports Iran  # trade deficit  

Turkey, which is not a major gold producer, was a net importer of gold, jewellery and precious metals in 2011 but swung to being a net exporter last year when it began shipping billions of dollars of the metal to Iran.

ANKARA(BullionStreet): Gold accounted for 9 percent of Turkey’s exports to Middle Eastern and North African (MENA) country's, particularly to Iran and the UAE.

According to Standard Chartered research, Iran and the United Arab Emirates received so much Turkish gold last year that the trade affected their export data.

That’s because of sanctions that prevent Turkey from buying Iranian oil with euros or dollars. Turkey is exempt from certain US sanctions on trade with Iran because it is dependent upon Iranian natural gas.

However, Iran-Turkey gold trade have been singled out by the US and EU for sanctions.

Analysts said Turkey pays Iran for natural gas in Turkish lira. Iranians then buy gold in Turkey and send it to Dubai via couriers, who import the yellow metal in hand luggage.

Once in Dubai, they can exchange gold for foreign currency, or ship it back to Iran. They added that, Interestingly, this turns up as exports in Turkey’s data.

Turkey, which is not a major gold producer, was a net importer of gold, jewellery and precious metals in 2011 but swung to being a net exporter last year when it began shipping billions of dollars of the metal to Iran.

In February, the most recent month for which figures are available,Turkey’s total exports of gold were worth $550 million, far below last year’s average of $1.1billion a month — although they were still almost wholly accounted for by sales to the UAE and Iran.

That drop in demand is likely to contribute to a rise in Turkey’s current account deficit this year, after a decline last year, and increases the woes of the country’s gold trade at a time when it is beset by other problems.

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