Türkiye's trade with Russia slows under sanctions pressure
Trade between Türkiye and Russia is experiencing disruptions due to Western sanctions, damaging Moscow's important supply channel.
Source: Bloomberg
Details: Kutlu Karavelioglu, chairman of the 22,000-member Machinery Exporters' Association, announced that machinery equipment exporters, who benefited the most from increased shipments to Russia, may see a US$1 billion reduction in sales this year due to "ambiguous" and "rapidly expanding" sanction lists and restrictions on goods with potential military use.
He reported that this accounts for one-third of last year's sales to Russia, adding that the greatest decline is currently observed in machine tools, pumps and electric motors.
Quote: "It doesn’t seem possible for any serious corporate machinery manufacturer to sustain its previous interest in Russia in the face of increasing pressure on the banking system and supply chains," Karavelioglu said.
This is bad news for Turkish companies and government efforts to reduce the current account deficit. However, it also indicates that US and EU sanctions against Russia are becoming increasingly effective, even in countries without union members like Türkiye.
Early reports from the Turkish Ministry of Trade showed that exports to Russia in the first quarter fell by 33.7% compared to the previous year.
Background:
- The volume of shipments from Türkiye to Russia decreased by 33% in February, amounting to US$670 million, compared to US$1 billion for the same period in 2023.
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