Since western sanctions, including Group of Seven nations and the European Union, have targeted Russian gold by banning imports and trade in an effort to block Russia’s economy following its invasion of Ukraine, Russian sellers have turned to buys from the United Arab Emirates, Hong Kong, and Turkey.
Bloomberg reports that Russia alone can’t absorb the $20 billion of gold it mines per year – logically. Thus, the Russians have found relative ease in reorienting the market towards the UAE, Hong Kong, and Turkey, which have not implemented any sanction.
For instance, VPower Finance Security in Hong Kong, which moves cash and gold for Chinese banks, has stepped in as a new player, handling more than $300 million of Russian gold from March to August 2022, per Bloomberg.
The United Arab Emirates saw more than $500 million of the metal hit its shores in the same stretch. Most of those merchants are based in Dubai – one example is Paloma Precious DMCC, which imported $109 million.Turkey has seen roughly $305 million of Russian gold going through its Istanbul airport in the six month stretch, ImportGenius data show.
Probably, however, Russia struggles to meet pre-war levels of gold exports. JPMorgan alone saw $1.2 billion of Russian gold deliveries in the first two months of 2022 alone before stepping away after the war began.
