Turkey plans gold import quota to cut current account deficit
Turkey plans to impose a quota on imports of unprocessed gold in order to reduce the negative impact on the current account balance, according to a source familiar with the matter and state-owned Anadolu Agency.
Anadolu reported on Monday that the Treasury had decided to introduce the quota in a bid to both relieve the deficit and boost forex reserves.
It said legislative work on the measure would be completed soon by the Treasury and the Trade Ministry and that the quotas will apply to unprocessed gold imports carried out by precious metals brokers who are members of Borsa Istanbul.
Imports of unprocessed gold in the first seven months of the year increased by 180% from the same period a year earlier to $19.4 billion, Trade Ministry data shows.
After February’s devastating earthquakes, restrictions were imposed on gold imports. But domestic demand for gold nonetheless became stronger, with negative returns on the lira being the main factor boosting demand.
Monthly quotas will be set taking into account the amount of unprocessed gold imports carried out by brokers in previous years, Anadolu said.
Imports made for the purpose of subsequent export will be excluded from the quota application in order to encourage gold production and exports, it added.
Central bank gold reserves have decreased by some $12 billion from their peak of $53.36 billion at end-March.