News / Europe

Iran's Foreign Minister to Make Key Turkish Visit

FILE - Iran's Foreign Minister Mohammad Javad Zarif attends a working luncheon in Kuwait.
FILE - Iran's Foreign Minister Mohammad Javad Zarif attends a working luncheon in Kuwait.
Dorian Jones
The Iranian foreign minister visits Turkey Saturday as the Turkish government continues to be mired in a deepening crisis involving a Turkish state bank that allegedly laundered money sent to Iran.

The allegation is putting Ankara and its state banks under increasing international scrutiny and is raising questions about Turkey's ability to obtain future international financing and investment.

Iranian foreign minister's Mohammad Javad Zarif's one-day visit is part of ongoing efforts to improve bilateral relations between the two countries.

But the visit comes at a potentially awkward time for Ankara, with one of its most prominent state banks at the center of a graft investigation involving Iran.

Suleyman Aslan, the CEO of Halkbank, was detained after a large amount of cash was found at his home, much of it stored in shoe boxes. Prosecutors claim it is part of a conspiracy to launder billions of dollars for Tehran to avoid international sanctions.
 
Analyst Atilla Yesilada of Global Source Partners said the investigation has cast a shadow over the Turkish finance industry.

“The accusations against Halkbank suggest that the Turkish banking system is not well defended or well monitored against money laundering and terror financing," he said. "I really need to see whether the loans to Turkey will be renewed."

Trade increases

Iranian-Turkish trade has markedly increased in recent years, despite ever-tightening international sanctions against Tehran for its controversial nuclear program.
 
Much of that trade has been energy imports. Ankara is the biggest customer of Iranian gas. But international sanctions have made such trade increasingly difficult.
 
Halkbank has been at the center of a “gas-for-gold” plan that allowed Tehran to buy gold with Turkish lira in exchange for Iranian natural gas and oil. Western sanctions over Iran's nuclear program prevented the country from getting paid in euros or dollars, so Halkbank used the gold to get around the restrictions.

Washington, which is in forefront of pursuing sanctions against Tehran, had voiced concern over Ankara’s trade dealings with Iran

But Asli Aydintasbas, a political columnist for the Turkish newspaper Milliyet, said the latest allegations may only cause limited adverse effects on Ankara’s relations with Washington.

“I don’t think this going to be that damaging if it just stays at this," he said. "Turkey had significantly curtailed gold trade with Iran and the Americans were willing to overlook whatever remains. And Washington itself is trying to mend fences with Iran.”

High cost

Although the diplomatic fall out may be limited, the financial consequences could be costly.  Experts point out that there are severe penalties for any institution breaching the sanctions.

Inan Demir, chief economist for the Istanbul-based Finans Bank, said the controversy comes at a bad time for Turkey.

“There has been a lot of negative publicity around the Turkish banking system - and the state banks in particular - and even more specifically Halkbank," he said.

"At a time of tighter global liquidity conditions, this negative publicity could lead to further tightening of financing conditions," he said. "And over the next 12 months Turkey is looking to refinance $164 billion of external debt."
 
Turkey’s economic minister, Ali Babacan, has been dismissing the allegations against Halkbank, claiming it is part of a conspiracy against the bank and Turkey. He also defended Halkbank’s relations with Iran, describing it as natural and the envy of its competitors.
 
But analyst Yesilada said that a worrying uncertainty hangs over the country’s financial industry.

“Suddenly, there is this huge cloud of suspicion over Turkey in terms whether it is legitimate country to do business in,” he said.

Despite the government removing hundreds of senior police officers and prosecutors linked to the graft investigation, the probe continues.

Observers warn the prospect of further revelations would only add to feelings of uncertainty towards Turkey among international bankers and investors.

You May Like

US Imposes Sanctions on Alleged Honduran Drug Gang

Treasury department alleges Los Valles group is responsible for smuggling tens of thousands of kilograms of cocaine into US each month More

At 91, Marvel Creator Stan Lee Continues to Expand his Universe

Company's chief emeritus hopes to interest new generation of children in superheroes of all shapes and sizes by publishing content across multiple media platforms More

Photogallery New Drug Protects Against Virus in Ebola Family

Study by researchers at University of Texas Medical Branch, Tekmira Pharmaceuticals is first looking at drug's effectiveness after onset of symptoms More

This forum has been closed.
Comment Sorting
Comments
     
by: Rome from: USA
January 05, 2014 1:49 AM
The Turkish government , Is cheating , lying , circumventing each and all international laws to profit from weak Obama administration ad well as weak EU Catrine Ashton . The purpose being gaining financial strength , laying the foundation of another Sharie state like Iran with further goal to spread Islamist anarchy and terrorism through out the free world .once his dream of Ottoman Empire is in place they reveal the true back warded nature . They must be punished and stopped.


by: Godwin from: Nigeria
January 04, 2014 7:21 AM
This is more than just mere diplomatic visit, it is a thank you visit to commiserate with Ankara for its solid support to Tehran in the heat of the sanctions. It also goes beyond the support during the hard sanctions, it is to thank Turkey for revealing the spy ring whose modus operandi was graphically exposed by Ankara to Tehran around August 2013. Often times I have written here that Turkey is more or less an islamist regime and there is nothing in it that is civilized, European or NATO. Erdogan has always wished to take Turkey back to the Ottoman Empire days, rule like the Ayatollahs and make Turkey like Iran ruled with sharia laws. The sympathy is what is translated to the money laundering, and I bet the PM will do everything he is known for, including lying, to cover up for Iran.
Even though the Prime Minister may be instituting investigations into these issues of money laundering et al, he is privy to every arrangement to cushion Iran against the effects of the sanctions imposed because of its nuclear program. Thus Erdogan has voiced his support for Iran's nuclear program, but being not able to further his position, resorted to illicit, illegal and unconventional approach to helping Iran beat the sanctions. This is cheating. It lands Turkey where Iran is - axis of evil and terror, after all it has openly identified with the Muslim Brotherhood of Egypt, Hamas in Gaza which are terrorist organizations, and now with Iran which is a state sponsor of terrorism worldwide and chief axis of terror. The world is waiting to see the outcome of this investigation sweep Turkey out of the EU to which it is a disgrace - if all the above allegations prove true.


by: Davis K. Thanjan from: New York
January 03, 2014 10:01 PM
Why the US and the EU are hesitant to take punitive action against the Turkish bank Halkbank and Turkey for money laundering in favor of Iran circumventing economic sanctions against Iran? Is it because of the membership of Turkey in the NATO?


by: Jacob Avi Cohen
January 03, 2014 7:25 PM
As an American, I can't believe how sneaky the Turkish government is. Turkey houses an American Air Force base and is a member of NATO. Why is Turkey money laundering dirty Iranian money. Iran is an axis of evil. Iran is a state sponsor of terrorism. Iran is a rogue state. The United States of America must question its relationship with Turkey. Turkey must not act outside international law. Iran has 1,001 world economic sanctions against it. Iran is an outlaw. Iran must be punished. Co-operating with Iran is injustice. Injustice anywhere is a threat to justice everywhere.

In Response

by: ll cool j from: sydney
January 04, 2014 12:02 AM
Only something a redneck trailer trash from the american south would say haha! The United States is a state sponsor of terror you stupid yank! I guess this is an example of how poor your education is lol! Which country has iran invaded or attacked in the last 100 years?? Can you name one yankee boy? Or is your brain too far up your rear to think straight? The united states secretly funds factions so wars continue to brew. You donkey shagging yanks blew your own buildings up just to invade iraq and afghanistan and kill thousands of innocent people for no reason. You losers have no credibility. Bush babies. Lol

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
African Media Tries to Educate Public About Ebolai
X
George Putic
August 20, 2014 8:57 PM
While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.
Video

Video African Media Tries to Educate Public About Ebola

While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.
Video

Video Ferguson Calls For Justice as Anger, Violence Grips Community

Violence, anger and frustration continue to grip the small St. Louis suburb of Ferguson, Missouri. Protests broke out after a white police officer fatally shot an unarmed black teenager on August 9. The case has sparked outrage around the nation and prompted the White House to send U.S. Attorney Eric Holder to the small community of just over 20,000 people. VOA’s Mary Alice Salinas has more from Ferguson.
Video

Video Beheading Of US Journalist Breeds Outrage

U.S. and British authorities have launched an investigation into an Islamic State video showing the beheading of kidnapped American journalist James Foley by a militant with a British accent. The extremist group, which posted the video on the Internet Tuesday, said the murder was revenge for U.S. airstrikes on militant positions in Iraq - and has threatened to execute another American journalist it is holding. Henry Ridgwell has more from London.
Video

Video Family Robots - The Next Big Thing?

Robots that can help us with daily chores like cooking and cleaning are a long way off, but automatons that serve as family companions may be much closer. Researchers in the United States, France, Japan and other countries are racing to build robots that can entertain and perform some simpler tasks for us. VOA’s George Putic reports.
Video

Video In Ukraine, Fear and Distrust Remain Where Fighting has Stopped

As the Ukrainian military reclaims control of eastern cities from pro-Russian separatists, residents are getting a chance to rebuild their lives. VOA's Gabe Joselow reports from the town of Kramatorsk in Donetsk province, where a sense of fear is still in the air, and distrust of the government in Kyiv still runs deep.
Video

Video Five Patients Given Experimental Ebola Drug Said to Be Improving

The World Health Organization has approved the use of experimental treatments for Ebola patients in West Africa. The Ebola outbreak there is unprecedented, the disease deadly. The number of people who have died from Ebola has surpassed 1,200. VOA's Carol Pearson reports on the ethical considerations of allowing experimental drugs to be used.
Video

Video China Targets Overseas Assets of Corrupt Officials

As China presses forward with its anti-graft effort, authorities are targeting corrupt officials who have sent family members and assets overseas. The efforts have stirred up a debate at home on exactly how many officials take that route and how likely it is they will be caught. Rebecca Valli has this report.
Video

Video Leading The Fight Against Islamic State, Kurds Question Iraqi Future

Western countries including the United States have begun arming the Kurdish Peshmerga forces in northern Iraq to aid their battle against extremist Sunni militants from the Islamic State. But there are concerns that a heavily-armed Kurdistan Regional Government, or KRG, might seek to declare independence and cause the break-up of the Iraqi state. As Henry Ridgwell reports from London, the KRG says it will only seek greater autonomy from Baghdad.
Video

Video In Rural Kenya, Pressure Builds Against Female Circumcision

In some Kenyan communities, female genital mutilation remains a rite of passage. But activists are pushing back, with education for girls and with threats of punishment those who perform the circumcision. Mohammed Yusuf looks at the practice in the rural eastern community of Tharaka-Nithi.

AppleAndroid