Since the beginning of the war in Ukraine and the imposition of Western sanctions, Russian bullion exports have had to seek new paths. For Russia, the UAE has a favorite destination for its gold, followed by China and Turkey. Reuters reports that 75. 7 tonnes of Russian gold bars ended up in the Gulf country over the past year, up from just 1. 3 tonnes in 2021.
Dubai (AsiaNews) – Since the beginning of the war in Ukraine and the upcoming imposition of Western economic sanctions, the United Arab Emirates (UAE) has a main center for the Russian gold industry after Russia’s classic export routes were closed.
Russian customs records show nearly a thousand shipments were made after February 2022, Reuters reports in a detailed file.
Between Feb. 24, 2022, and March 3, 2023, the Gulf country imported 75. 7 tons of Russian gold worth $4. 3 billion, up from just 1. 3 tons in 2021. China and Turkey are the other two main destinations, with about 20 tons each.
Together, the 3 countries account for 99. 8% of total Russian exports during this period.
After the outbreak of war in Ukraine, many foreign banks, logistics providers and valuable steel refineries stopped processing Russian gold, which was sent to London, the center of gold industry and storage.
From 7 March 2022, the London Bullion Market Association banned Russian bullion, while the United Kingdom, European Union, the United States, Canada and Japan banned all imports of Russian bullion in August 2022.
However, Russian gold has discovered new markets in countries that have followed the West in applying sanctions. For its part, Turkey has maintained an ambiguous attitude.
Louis Marechal, a gold sourcing expert at the Organization for Economic Cooperation and Development (OECD), said Russian gold could simply be melted down and melted down to be sold on U. S. and European markets with its origin masked.
Despite its evident progress and innovation and relative tolerance towards other religions, the UAE can be a position of shady transactions, only in gold and oil, but also in other commodities, to mention a possible tax haven for tax evaders and traffickers.
For its part, the UAE Gold Bullion Committee, a government body, said the UAE follows transparent and physically powerful procedures that oppose illegal goods, money laundering and sanctioned entities.
“The UAE will continue its industry brazenly and with its foreign partners, in accordance with all applicable foreign criteria established through the United Nations,” he said.
In an effort to further isolate Russia, the U. S. The U. S. warned several countries, including the United Arab Emirates and Turkey, that they could lose out to G7 markets if they do business with entities subject to U. S. sanctions. U. S.
However, in its report, Reuters found no obvious violations and noted that the transactions were within legal limits.
Louis Marechal, representative of Metals Focus, estimates that Russia produced 325 tons of gold in 2022, while Russian customs records show exports of 116. 3 tons between February 24, 2022 and March 3, 2023.
Thus, the others did not leave the country or were shipped without being registered; in the end, it is very unlikely to know how much Russia exported.
Meanwhile, the UAE is a major bullion exporter and has boosted its already thriving gold industry.
Trade knowledge shows that it imported about 750 tons of natural gold in an average year between 2016 and 2021, with Russian gold accounting for only about 10% of total imports.
To incentivize buyers, Russian gold bars were recently sold to the UAE with a reduction of around 1% compared to global benchmark prices.
The head of a shipping company, who spoke on condition of anonymity, said the most of the gold his company sent to the United Arab Emirates bound for refineries, where it would be melted down and melted.
Since customs records only show shippers or investors involved in transactions and the end buyer, which may simply be a refiner, jeweler or investor, Russian gold can end up anywhere, including in Europe, without the threat of sanctions for violating sanctions. .
Since the beginning of the war in Ukraine and the imposition of Western sanctions, Russian bullion exports have had to seek new paths. For Russia, the UAE has a favorite destination for its gold, followed by China and Turkey. Reuters reports that 75. 7 tonnes of Russian gold bars ended up in the Gulf country over the past year, up from just 1. 3 tonnes in 2021.