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Turkey "Would Be In Recession Without Gold Bullion Exports"

TURKEY'S exports of Gold Bullion probably prevented it falling into recession in the third quarter despite a sharp fall in economic growth, according to one analyst.

Turkey exported $11.9 billion of gold during the first 10 months of 2012, Bloomberg reports, with 85% of this going to Iran and the United Arab Emirates.

"It's unclear as to how long the surge in gold sales will continue, but without it Turkey would have almost certainly slipped into recession," says Neil Shearing, chief emerging markets economist at consultancy Capital Economics.

Turkey's current account deficit has fallen by around 80% since its March 2011 peak of $9.5 billion.

"I would be much more confident of this [improvement] in the absence of the gold exports," says Inan Demir, chief economist at Finansbank in Istanbul.

"I think the narrowing trend in the current account deficit has come, or is coming to an end."

Earlier this year, Turkey's energy minister confirmed the use of gold in trade with Iran.

Back in January, the European Union banned the trade of gold, oil and diamonds with Iran after it joined the US in applying sanctions. 

Turkey's total gold demand accounted for 4.2% of the world total in Q3, according to data published by the World Gold Council.

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