Thursday, May 23rd 01:33 PM IST

Turkish traders likely to continue Iran Gold deal

# Turkey gold  # gold exports Iran  # US sanctions  

Analysts said even if the Turkish government heeds this calling, Turkish businessmen will still find a way to continue trading with Iran.

ANKARA(BullionStreet): Turkish gold businessmen are considering various options to circumvent US sanctions on their gold trade with Iran.

Turkish Union for Jewellery and Precious Metals exporters said Turkey is a country that buys a bar of gold and deals with its processing on its own, thus making the price more attractive. That is why Iran chooses us. At the same time, there are three gold processing plants in Turkey, all members of the London Bullion Market Association(LBMA).

There are only five such countries in the world, and Turkey is one of them. It offers gold at a price $50-100 lower than the average price on international market, that is why Iran chooses Turkey.”

The US authorities are going to enforce a ban on gold sales to Iran as part of extra unilateral sanctions against the country from July 1. The sanctions suggest a ban on selling gold and other precious metals to private and state-run Iranian companies, as well as to individuals holding Iranian citizenship.

The new ban first of all relates to US companies and individuals, although Washington will certainly try to attract other countries to join it, too. Challenged by the previously imposed financial sanctions Iran has been actively buying gold on international market. Iranians are believed to use gold as a currency during trades with international partners.

As a result, in 2012 the mutual trade between Turkey and Iran played more into the hands of Ankara: Turkey’s export volume to Iran stood at $9.9 billion, with precious metals constituting $7 billion.

Washington has been closely watching Turkey-Iran gold trade and has repeatedly called to stop gold supplies to Tehran.

Analysts said even if the Turkish government heeds this calling, Turkish businessmen will still find a way to continue trading with Iran.

They added that chances are that Turkish dealers will simply start selling gold to that country and- indirectly- to Turkey. Gold trade is global. Gold can be bought and sold in every part of the world.

In 2012 Turkey’s export of precious and semi-precious stones and metals rose nearly five-fold on the year and stood at $16.3 billion.

At the same time, gold imports in Jan-Apr of 2013 showed a rise by over 500% on the year, which makes new records highly possible this year, no matter whether Turkey continues direct trade with Iran or not.

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