Turkish Businesses Seek Streamlined Ruble Payments System in Trade with Russia

Turkish Businesses Seek Streamlined Ruble Payments System in Trade with Russia

ANATOLIA REPORT

April, 2022

Since the currency dispute with shipping companies is causing problems in the delivery of goods passing through customs, Turkiye actively work to develop a mechanism to facilitate trade with Russia in rubles, according to Istanbul Chamber of Commerce (ITO) head Şekib Avdagiç.

Avdagiç stated that the companies working with Russia see the withdrawal of Western countries from Moscow as a new opportunity and emphasized that it is important to enable the use of the national currency of Russia.

The issue was also brought up during President Recep Tayyip Erdoğan’s phone call with his Russian counterpart Vladimir Putin, he reiterated.

Erdoğan told Putin that, apart from the euro and dollar, trade between the two countries can be carried out using the Russian ruble and Chinese yuan.

“We can do it with gold,” he was quoted as suggesting.

Stating that they also expect air transport to be made more competitive so they are able to deliver ongoing orders, Avdagiç said, “The brutality of the war is showing itself once again, and the humanitarian and geopolitical consequences of Russia’s invasion of Ukraine overshadow its economic effects. The war, so to speak, has added yet another global humanitarian catastrophe. We share the approach put forward by our president, and we find it unacceptable that an independent country is occupied by another power.”

He further noted that the measures taken by Turkiye’s government to mitigate the effects of geopolitical risks on the economy are very important, saying: “We are following with appreciation the efforts put forward in this framework. The close monitoring mechanisms established by the economic administration during this period and the close dialogue it developed with all producers provided significant gains in the solution of problems and contributed significantly to the formation of appropriate policies.”

Stating that Turkiye’s economic model is being implemented and the financial instruments developed within this framework have largely eliminated the volatility in the markets and played an important role in stabilizing the Turkish lira, Avdagiç said, “As the Istanbul Chamber of Commerce and the Istanbul business world, they have made all efforts towards these goals.”

Drawing attention to the developments in the marketplace of the Laleli district of Istanbul, which has huge trade ties with Russia, Avdagiç said in the trade with Russia and Ukraine, extending the legal period for closing the export receivables will be very useful.

“Almost all of the Laleli market produces for Russia, along with Eastern European countries and Caucasian countries,” he said.

Some measures need to be taken to minimize losses and enable businesses to continue trade, the ITO head said, emphasizing that to find alternative export routes, countries such as Bulgaria, Romania, Moldova, Uzbekistan, Kyrgyzstan, Kazakhstan, Georgia, Belarus and Tajikistan must be exempted from tax, which would decrease export costs.