Trade settlements between Russia and Turkey are facing significant disruptions due to new Western sanctions imposed on Russia. According to Russian media reports, the United States is closely monitoring all sources of financial transfers to and from Russia, leading to increased scrutiny of bank accounts held by Russian nationals in Turkey.
The recent sanctions have created challenges for trade settlements between Turkey and Russia, which are vital to both economies. Turkish sources have indicated that banks are under heightened pressure regarding transactions involving Russian clients. An anonymous source stated:
“Our banks, both state and private, are currently under increased pressure from the United States due to the recent sanctions package against Russia. All sources of transfers to and from Russia are being checked, and the opening of bank accounts is under strict control by head offices.”
Turkey has emerged as one of Russia’s key commercial partners, alongside China and India, with trade turnover expected to reach $55 billion this year, as noted by Turkish President Recep Tayyip Erdoğan. However, the ongoing sanctions have raised concerns about the future of this economic relationship.
The Russian Ambassador to Ankara, Alexey Erkhov, has expressed concerns that the sanctions aim to undermine Russian-Turkish trade and economic cooperation. He highlighted that there have already been instances of blocked transfers and closed accounts due to these pressures.
The issues affecting trade settlements are not limited to Turkey; Russia’s financial interactions with China are also being impacted. Payments for importing dual-use products, which can serve both civilian and military purposes, are reportedly being halted by banks to avoid potential sanctions violations.
Recent data indicates a decline in trade volumes between Turkey and Russia. Turkish machinery exporters, who previously benefited from increased sales to Russia, may see revenues drop by $1 billion in 2024 due to the expanding sanctions landscape. According to Turkey’s Trade Ministry, exports to Russia fell by 33.7% in the first quarter of 2024 compared to the previous year.
As Western sanctions continue to tighten, both Turkey and Russia may face increasing challenges in maintaining their trade relationship. Turkish officials have expressed their commitment to navigating these pressures while seeking to sustain economic ties with Russia, but the path forward remains uncertain amid the evolving geopolitical landscape.
