Turkey announced increased problems with making payments with Russia

Problems with payments in trade with RUSSIA have become more frequent over the past 15-20 days, but the situation will soon improve, said the chairman of the Turkish Exporters Assembly. According to a TASS source , interruptions in transfers are related to sanctions

Turkish companies exporting to Russia have faced increasing payment problems in recent weeks due to audits and inspections by authorities, but the situation is expected to improve next month. This was stated by the Chairman of the Turkish Exporters Assembly (TIM) Mustafa Gültepe, REUTERS reports .

“The problem with payments in trade with Russia has become more frequent over the past 15-20 days <...>, but I think the situation will improve after January,” Gültepe said.

He also noted that Turkish exporters want the government to implement economic policies that would improve their competitiveness, adding that orders from usual large buyers have dropped sharply. “Companies may cut more staff in the first quarter of this year. Over the past year, the main purchasing groups have reduced their orders by about 30%,” the HEAD of the association indicated.

Due to the relatively stable exchange rate, exporters have also asked the central bank to increase the percentage of EXPORT earnings they must convert into lira from 40 to 60%, on the condition that the conversion premium be doubled to 4%, Gültepe said.

Earlier on January 16, TASS, citing a source in the Turkish banking industry, reported that interruptions in money transfers from Russia to Turkey are associated with regulatory measures by the US Treasury Department's Office of Foreign Assets Control (OFAC).

He added that the measures were “too broadly worded” and Turkish banks would seek further clarification. Until their publication, organizations are in “standby mode,” which is why interruptions occur.

As Reuters notes, the problems arose at a “challenging time” for Turkish exporters, who faced a blow to their competitiveness due to rising inflation in the country. According to TIM, Russia ranks seventh in the list of countries in terms of the volume of exports of Turkish companies: last year, goods worth about $9.4 billion were exported to the country.

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Turkish President Recep Tayyip Erdogan said in early January that Turkish exports in 2023 exceeded $255.8 billion, with exports to Russia increasing by 17%. TIM expects exports to reach $267 billion this year.

Last February , BLOOMBERG reported that the United States warned Turkish and UAE authorities that their economic and financial ties with Russia were hampering efforts to put pressure on Moscow. After that, from March 1, Turkey stopped the transit of goods subject to Western sanctions and distributed a “prohibited” list to its companies.

Moscow considers Western sanctions illegal. Presidential press secretary Dmitry Peskov said that the country had adapted to the restrictions and learned to “hedge against sanctions risks.”