Oddity in Turkish gold trade raises questions
Turkey’s gold exports have plummeted by over 42 percent to $377 million in April, while the imports dived to $433 million, down by 83 percent from last year’s same month. In overall, Turkey’s trade gap contracted by over 30 percent. REUTERS photoTurkey’s gold exports and imports dipped in April, adding to questions over unexplained sharp moves in trading after recording a surprising leap in exports to Switzerland in March.
Foreign trade data announced by the Turkish Statistical Institute (TÜİK) has revealed precious metal and stone exports fell by 42.8 percent to $377.3 million, while imports in the same item plummeted by 83 percent to $433.7 million.
The trade as a whole plunged 75 percent, reaching its lowest level since December 2012.
The figures caused analysts to miss the mark on their trade gap forecast for April as they were expecting around $1.2 billion in gold exports.
The shockingly sharp decline added to the oddity in the country’s gold trade balance, which drew attention in March with a “mysterious” rise in exports to Switzerland.
Turkey sent a record $1.275 billion of gold to Switzerland in March, with Turkish gold exports to Switzerland in the first quarter totaling $2 billion, up from just $102,912 a year earlier.
Some analysts guessed the move might have been driven indirectly by Turkey’s gold-for-gas trade with Iran.
Turkey has in the past imported large amounts of gold to transfer to Iran. But the trade tailed off last year as U.S. sanctions imposed on Tehran were tightened.
“Turkey imported a huge amount of gold in the past period to be transferred to Iran. But when this channel was closed, a portion of this stock could have been sent to Switzerland to be turned into cash in anticipation of gold prices falling,” an official said.
Weak lira, stronger Europe close gap
Overall trade deficit further narrowed in April, helped by falling imports and rising exports, particularly led by a recovery in Turkey’s main trade market, Europe.
The gap declined to $7.2 billion during the month, 30.3 percent down from the same month last year, according to temporary foreign trade figures announced by the Turkish Statistical Institute (TÜİK) and the Customs and Trade Ministry.
Turkey’s exports rose 7.9 percent to reach $13.4 billion, while imports plunged by 9.5 percent to $20.6 billion, increasing the rate of exports to imports from 54.6 percent to 65.1 percent.
Along with the weakening Turkish Lira, which made Turkish goods cheaper and more attractive in international markets, the economic recovery in Turkish exports’ top destination, Europe, helped the trade performance of the country bounce.
Turkey’s exports to EU countries leapt 20.5 percent compared to April last year, reaching $5.9 billion. Therefore, the EU’s share in Turkey’s exports rose to 44.2 percent, from 39.6 percent last year.
Germany kept its place as the top export market for Turkish exporters, which sent $1.26 billion worth of goods to the country in April.
Iraq with $1.25 billion, the U.K. with $855 million, and Italy with $645 million, followed Germany as Turkey’s leading export partners during the month.
In imports, Russia again topped the list with $2.1 billion worth of imports. Germany ranked second with $2 billion, while China and the U.S. ranked $1.8 and $1.1 billion respectively.