All eyes are on Turkish gold sales after roughly three-quarters of Turkey’s gold exports made it to iran in the first five months of the year. Data from the Turkish Statistics Institute (TurkStat) have shown that Turkey exported gold worth $4.02 billion in the first five months of 2012, with $3.08 billion of that sum exported to Iran. This means Turkey’s gold exports to Iran have increased roughly eightfold compared to the same period in 2011. It is speculated Iranians are turning to gold as a method of saving as Western sanctions tighten.
TurkStat data show that Turkey exported gold worth $4.02 billion in the first five months of 2012, with $3.08 billion of that sum exported to Iran. This means Turkey’s gold exports to Iran have increased roughly eightfold over the same period of 2011
The mass purchase of Turkey’s gold is being undertaken by rich Iranian families living in Turkey. These families largely do business in the fields of construction and iron and steel production. There are rumors that they purchase Turkish gold via third persons in order not to be noticed, and that they entrust the purchased gold to the Central Bank of the Islamic Republic of Iran (CBI), again via third persons. The CBI supports the purchases in order to gain strength in the face of increasing sanctions from European countries.
Sanctions are aimed at forcing Iran to curb its nuclear program and mainly target Iran’s energy and banking sectors. Turkey has become an increasingly important channel for the Islamic republic following new measures added to already tight sanctions earlier this month.
A senior government official, who declined to be named, told Today’s Zaman that Iran collects gold from countries such as Dubai and India as well as Turkey. “Iranian companies both earn money through gold purchases and serve their country by strengthening its CBI.
They are worried that new sanctions may come after sanctions imposed on oil sales, and they are working to strengthen the CBI,” the official stated. There are also rumors that the US is uneasy about the skyrocketing Iranian purchase of Turkey’s gold, and has been following the purchases.
Erkan Kurtulmuş, president of the İstanbul Chamber of Commerce (İTO) Jewelry Committee, is worried that Iran may be struggling to increase its gold reserves before a possible war. In his view, there are “big players” involved in Iran’s gold purchases from Turkey, as ordinary customers would not be allowed to take a share of sales. Kurtulmuş also said Turkey imports scrap gold, which is melted down and then reshaped. However, the scrap gold business is mainly unregistered, and the state does not levy taxes in this sector. According to TurkStat statistics, Turkey exported the highest quantity to Iran in May of this year, with an amount roughly five times higher than in the same month in 2011. Gold exports to Iran reached $1.3 billion in May. The total exports to Turkey in the same month were worth $1.6 billion.
Turkey has seen a rapid increase in Iranian-funded foreign companies within its borders. Turkish authorities suspect some of these may be front companies set up to circumvent Western sanctions. They are concerned that some of the activities of Iranian companies may risk an unwanted confrontation between Ankara and its Western allies. According to the Turkish Union of Chambers and Commodity Exchanges (TOBB), foreign companies financed by Iran in Turkey in 2011 totaled 590, an increase of 41 percent compared to the previous year. That puts Iran at the top of the chart for new foreign companies established in 2011 not only in numbers but percentage-wise as well. As of Dec. 31, 2011, the number of companies funded by Iran totaled 2,140, with a quarter having launched operations in the last year alone.