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Turkey to Repatriate All Gold from the US

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After Venezuela, Germany, Austria and the Netherlands prudently repatriated a substantial portion (if not all) of their physical gold held at the NY Fed or other western central banks in recent years, this morning Turkey also announced that it has decided to repatriate all its gold stored in the US Federal Reserve and deliver it to the Istanbul Stock Exchange, according to reports in Turkey's Yeni Safak. It won't be the first time Turkey has asked the NY Fed to ship the country's gold back: in recent years, Turkey repatriated 220 tons of gold from abroad, of which 28.7 tons was brought back from the US last year, reported Zero Hedge (US).

According to the latest IMF data, Turkey’s gold reserves are estimated at 591 tons, worth just over $23 billion. This makes Ankara the 11th largest gold holder, behind the Netherlands and ahead of India.

Turkey's gold repatriation come at a sensitive time for Turkey's currency, the lira, which has been pounded, and plunged to all time lows against both the dollar and the euro despite runaway, double-digit inflation in Turkey, as the central bank is seemingly afraid of President Recep Tayyip Erdogan, and refuses to raise rates.

Meanwhile, Erdogan has taken a tough stance against the US currency, criticized dollar loans and saying that international loans should be given in gold instead.

"Why do we make all loans in dollars? Let’s use another currency. I suggest that the loans should be made based on gold,” Erdoğan said during a speech at the Global Entrepreneurship Congress in Istanbul on April 16, according to Hurriyet.

In what some saw an appeal for a gold standard by the Turkish president, Erdogan added that “with the dollar the world is always under exchange rate pressure. We should save states and nations from this exchange rate pressure. Gold has never been a tool of oppression throughout history."

Well, now that Turkey will soon have all of its gold on the ground, Erdogan will be able to launch a gold-backed currency if he so desires. Unfortunately, all signs point to the gold being repatriated only so it can be raided, pillaged and promptly deposited in offshore vaults by members of the ruling oligarchy.

As noted above, Turkey has been one of several countries which have moved their gold from the world's biggest, and most secure gold vault, that located 95 feet below sea level at 33 Liberty Street in Manhattan, also known as the New York Fed.

The repatriation wave began in 2012, when Venezuela announced it was withdrawing all of its 160 tons of gold at the NY Fed, valued at around $9 billion. Germany’s Bundesbank then demanded 300 tons be returned, with the Fed saying it would take seven years to do so; a scrambling Germany was able to complete the process 3 years ahead of schedule. The Netherlands has also repatriated 122.5 tons of gold.

As a result, according to the latest Fed data, the amount of physical gold stored at the NY Fed has dropped to the lowest on record, or 7.819 thousand tons, following a withdrawal scramble that started in 2014 and continued until the end of 2016. After a 15 month hiatus, withdrawals resumed in 2018, with 15.5 tons of gold repatriated in January and February.

“The central banks started the repatriation already a few years ago, meaning before we had Brexit, Catalonia, Trump, AFD or the rising tensions between the Politburo in Brussels and the nations of Eastern Europe,” said Claudio Grass of Precious Metal Advisory in Switzerland.

According to him, the world is becoming less centralized. “If we follow this trend, it should be obvious that the next step should be an even bigger break up into smaller units than the nation state. With such geopolitical fragmentation comes also the decentralization of power."


The biggest uncertainty regarding the relations between Turkey and Greece involves Turkey’s president, Recep Tayyip Erdogan, and whether his ambitions are fuelling renewed claims to Greek isles, the New York Times (NYT) wrote and reported Ahval (Turkey).

The relations between two countries has been strained in recent months after Turkish President Recep Tayyip Erdoğan called for the renegotiation of the 1923 treaty demarcating the countries’ borders during his visit to Athens in December 2017. The natural gas resources in east Mediterranean, the Greece’s refusal to extradite eight Turkish soldiers accused of participating the coup attempt in Turkey in 2016, the arrest of two Greek soldiers by Turkish authorities in March after they crossed the border in bad weather, as well as the historical dispute on Cyprus are among reasons of high tensions in relations.

Both countries engage in military show offs on the Aegean with their naval and air forces. As NYT noted, during the last two weeks, a low-flying Turkish helicopter passed provocatively close to a military base on the nearby Greek island of Ro, a Greek fighter pilot died after he crashed while attempting to intercept a Turkish aircraft, Turkey claimed its coast guard had removed a Greek flag from an islet near the island of Fournoi, and Turkish fighter jets harassed a helicopter carrying Alexis Tsipras, the Greek Prime Minister as it flew from the islet of Ro to Rhodes.

“The biggest uncertainty involves Turkey’s strongman president, Recep Tayyip Erdogan, and whether his ambitions are fueling renewed claims to these Greek isles — particularly after he embarked on an election campaign in which he is expected to play heavily on nationalistic sentiment,” the NYT said adding that “analysts worry that the unpredictable nature of Mr. Erdogan makes the situation more volatile than ever between the countries”.

“Erdogan is a little bit out of control — he’s picking a lot of fights and there is a lot of uncertainty about how far he’s prepared to go,” said think tank researcher Nikos Tsafo According to Tsafo “the odds of something going wrong are increasing on a weekly basis”.

“The potential for a military conflict between Greece and Turkey has never seemed as close since the 1990s,” told Soner Cagaptay, director of the Turkish Research Program at the Washington Institute for Near East Policy to NYT.

On the other hand, an anonymous senior Turkish official accused Greece of attention seeking. “They’re like babies, and it’s always been like that,” he said.

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Reporter: Denes Osvalt
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