News / Middle East

    Turkey Aids Iran Through Gold Trade

    Turkey's Foreign Minister Ahmet Davutoglu (R) shakes hands with Iranian President Mahmoud Ahmadinejad before an official meeting in Tehran, January 5, 2012.
    Turkey's Foreign Minister Ahmet Davutoglu (R) shakes hands with Iranian President Mahmoud Ahmadinejad before an official meeting in Tehran, January 5, 2012.
    Dorian Jones
    Banks in Turkey continue to send gold to Iran despite U.S. pressure to curb a booming gold-for-gas trade, which helps Iran skirt international sanctions. 

    This month, Turkish customs grounded a Turkish cargo plane en route from Ghana to Iran that was reportedly carrying a ton-and-a-half of gold.

    Tehran has been accumulating huge amounts of the precious metal over the past year as a means of circumventing ever-tightening international financial sanctions over its nuclear enrichment program, which some nations fear is being used to develop a nuclear weapons' capability.

    Turkey continues to provide the lion’s share of Tehran's demand for gold, said Attila Yesilada, of the Istanbul-based research firm Global Source Partners.

    "Gold sales [to Iran] have been diversified through Switzerland and Abu Dhabi, but the annualized total for last year is something like $11 billion, most of it financed through the gold stock of Turkish people," Yesilada said.  "This gold has become Iran’s main currency in terms [of] securing necessities from abroad."

    Turkey's Deputy Prime Minister Ali Babacan confirmed last November that Tehran pays for the gold from the Turkish Lira payments it receives for its gas exports to Turkey. Iran sells 90 percent of its natural gas to Turkey, making it Ankara's second largest supplier after Russia.

    To stem the flow of gold, U.S. President Barack Obama this month signed into law a ban on the sale of precious metals to Iran.  But Turkey is not bound by the measure, said Turkish Foreign Ministry spokesman Selcuk Unal.

    "Turkey only feels itself legally bound only by U.N. Security Council resolutions or sanctions adopted under Chapter Seven," he said.

    However, analyst Yesilada said he expects Ankara to eventually comply.

    "The United States will first try to convince Ankara to unilaterally stop this. If that is not working, we will see rising pressure that paralyzes those [who] in any way intermediate or help intermediate this trade," he said.

    Until now Ankara has largely complied with U.S. measures against Tehran.  But Ankara still has to pay its bill for Iranian gas. Analysts point out that diversifying Turkey's energy dependency on Iran takes time and can be expensive. This month, Turkey signed a $12 billion deal with an Abu Dhabi company to develop the use of coal in energy production.

    But Jamshid Assadi, an expert on Iran at France’s Burgundy Business School, said there are short-term alternatives to gold for Ankara to pay Tehran.

    "One of the solutions for Iran, and they did that mainly with India, was that 'We sell you oil and you cannot pay us back so we do barter: you give us your products, whatever we need,'" Assadi said.

    A senior Turkish official, who spoke on condition of anonymity, confirmed that Ankara was looking into bartering as a means of continuing to trade with Iran. Experts point out bartering has an added bonus for Turkey.  Any products it barters will be locally produced, unlike gold, which it has to import.

    Bartering could also help allay security concerns, said Yesilada.

    "The problem now is neither Ankara nor Washington knows what Iran is using its gold for; it might be buying grain or other necessities, or maybe financing Assad’s forces [in Syria] or Hezbollah in Lebanon in... some terror acts," he said. "With barter, that is completely eliminated from the equation."

    With more than 2,000 Iranian companies operating in Turkey, there already is a business network that could facilitate large-scale bartering.

    With further sanctions against Iran possible, pressure is expected to grow on Turkey to lessen its energy dependence on Iran. Analysts think that process might accelerate with Tehran and Ankara increasingly at odds in the region, in particular over Syria.

    You May Like

    Hope Remains for Rio Olympic Games, Despite Woes

    Facing a host of problems, Rio prepares for holding the games but experts say some risks, like Zika, may not be as grave as initially thought

    IS Use of Social Media to Recruit, Radicalize Still a Top Threat to US

    Despite military gains against IS in Iraq and Syria, their internet propaganda still commands an audience; US officials see 'the most complex challenge that the federal government and industry face'

    ‘Time Is Now’ to Save Africa’s Animals From Poachers, Activist Says

    During Zimbabwe visit, African Wildlife Foundation President Kaddu Sebunya says poaching hurts Africa as slave trade once did

    This forum has been closed.
    Comment Sorting
    Comments
         
    by: G Emil from: Ghana
    February 02, 2013 2:57 PM
    It is expected of every one to live right, speak the truth, and do justice. I believe the right thing must be done no matter who is involved.Think deep abt that.

    by: JKF from: Ottawa, Canada
    January 26, 2013 9:46 PM
    In my view, Turkey's Erdogan continues to play a double game, and is in fact using the Western block. He has one of the largest military forces in the world, if he had the courage, he could end the conflict in Syria in a matter of weeks. He has requested NATO help for the strict purpose of getting NATO involved in his scheme on Syria.
    The fact that Erdogan continues to violate the embargo against Iran, while at the same time fully supporting the opposition in Syria, demonstrates that he is double dealing against the West and at the same time double dealing Iran.
    The fact that he has taken sides, with the North African Islamists against the position of the EU and the US, is the most worrisome of his double dealing, because it puts him fully at odds with the US/EU and even the majority of the regional countries in Africa which support the French initiative in Mali, not only by word, but also have committed troups to help Mali restore its sovereignity. I think Erdogan's Turkey is no longer a true, dedicated and NATO principles supporting ally.
    In Response

    by: kadir from: turkey
    January 29, 2013 12:48 PM
    no one has the ability to say turkey to do sth. because turkey is a very big power and country in the world aspecially in the middle east where's the center of the world with its energy sources..

    by: Emrah from: Turkey
    January 25, 2013 5:26 AM
    Turkey needs energy for running its industry that feeds its people and our neighbor Iran has it cheaper but someone from another continent tells us "no, you can't buy it". it is just ridiculous!!!
    In Response

    by: Francisco from: Brazil
    January 25, 2013 8:52 AM
    Americans believe they can rule the world.
    So why don't they foot the bill and offer some free oil to Turks?

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Ivorian Chocolate Makers Promote Locally-made Chocolatei
    X
    July 29, 2016 4:02 PM
    Ivory Coast is the world's top producer of cocoa but hardly any of it is processed into chocolate there. Instead, the cocoa is sent abroad to chocolate makers in Europe and elsewhere. This is a general problem throughout Africa – massive exports of raw materials but few finished goods. As Emilie Iob reports from Abidjan, several Ivorian entrepreneurs are working to change that formula - 100 percent Ivorian chocolate bar at a time.
    Video

    Video Ivorian Chocolate Makers Promote Locally-made Chocolate

    Ivory Coast is the world's top producer of cocoa but hardly any of it is processed into chocolate there. Instead, the cocoa is sent abroad to chocolate makers in Europe and elsewhere. This is a general problem throughout Africa – massive exports of raw materials but few finished goods. As Emilie Iob reports from Abidjan, several Ivorian entrepreneurs are working to change that formula - 100 percent Ivorian chocolate bar at a time.
    Video

    Video Tesla Opens Battery-Producing Gigafactory

    Two years after starting to produce electric cars, U.S. car maker Tesla Motors has opened the first part of its huge battery manufacturing plant, which will eventually cover more than a square kilometer. Situated close to Reno, Nevada, the so-called Gigafactory will eventually produce more lithium-ion batteries than were made worldwide in 2013. VOA's George Putic reports.
    Video

    Video Polio-affected Afghan Student Fulfilling Her Dreams in America

    Afghanistan is one of only two countries in the world where children still get infected by polio. The other is Pakistan. Mahbooba Akhtarzada who is from Afghanistan, was disabled by polio, but has managed to overcome the obstacles caused by this crippling disease. VOA's Zheela Nasari caught up with Akhtarzada and brings us this report narrated by Bronwyn Benito.
    Video

    Video Hillary Clinton Promises to Build a 'Better Tomorrow'

    Democratic presidential candidate Hillary Clinton urged voters Thursday not to give in to the politics of fear. She vowed to unite the country and move it forward if elected in November. Clinton formally accepted the Democratic Party's nomination at its national convention in Philadelphia. VOA national correspondent Jim Malone has more.
    Video

    Video Trump Tones Down Praise for Russia

    Republican presidential candidate Donald Trump is toning down his compliments for Russia and Vladimir Putin as such rhetoric got him in trouble recently. After calling on Russia to find 30.000 missing emails from rival Hillary Clinton, Trump told reporters he doesn't know Putin and never called him a great leader, just one who's better than President Barack Obama. Putin has welcomed Trump's overtures, but, as Zlatica Hoke reports, ordinary Russians say they are not putting much faith in Trump.
    Video

    Video Uganda Unveils its First Solar-powered Bus

    A solar-powered bus described by its Ugandan makers as the first in Africa has made its public debut. Kiira Motors' electric bus, Kayoola, displayed recently at a stadium in Uganda's capital. From Kampala, Maurice Magorane filed this report narrated by Salem Solomon.
    Video

    Video Silicon Valley: More Than A Place, It's a Culture

    Silicon Valley is a technology powerhouse and a place that companies such as Google, Facebook and Apple call home. It is a region in northern California that stretches from San Francisco to San Jose. But, more than that, it's known for its startup culture. VOA's Elizabeth Lee went inside one company to find out what it's like to work in a startup.
    Video

    Video Immigrant Delegate Marvels at Democratic Process

    It’s been a bitter and divisive election season – but first time Indian-American delegate Dr. Shashi Gupta headed to the Democratic National Convention with a sense of hope. VOA’s Katherine Gypson followed this immigrant with the love of U.S. politics all the way to Philadelphia.
    Video

    Video Dutch Entrepreneurs Turn Rainwater Into Beer

    June has been recorded as one of the wettest months in more than a century in many parts of Europe. To a group of entrepreneurs in Amsterdam the rain came as a blessing, as they used the extra water to brew beer. Serginho Roosblad has more to the story.
    Video

    Video Commerce Thrives on US-Mexico Border

    At the Democratic Convention in Philadelphia this week, the party’s presumptive presidential nominee, Hillary Clinton, is expected to attack proposals made by her opponent, Republican presidential nominee Donald Trump, to build a wall along the U.S.-Mexico border. Last Friday, President Barack Obama hosted his Mexican counterpart, President Enrique Peña Nieto, to underscore the good relations between the two countries. VOA’s Greg Flakus reports from Tucson.
    Video

    Video Film Helps Save Ethiopian Children Thought to be Cursed

    'Omo Child' looks at effort of African man to stop killings of ‘mingi’ children
    Video

    Video London’s Financial Crown at Risk as Rivals Eye Brexit Opportunities

    By most measures, London rivals New York as the only true global financial center. But Britain’s vote to leave the European Union – so-called ‘Brexit’ – means the city could lose its right to sell services tariff-free across the bloc, risking its position as Europe’s financial headquarters. Already some banks have said they may shift operations to the mainland. Henry Ridgwell reports from London.

    Special Report

    Adrift The Invisible African Diaspora