Turkey's economic ties with Russia 'legal,' says finance minister

Turkish Finance Minister Nureddin Nebati has deemed Turkey's economic relations with Russia "legal," amid the concerns among Turkish businesses over a U.S. Treasury warning that they risked being penalised if they maintained commercial ties with Russians under sanctions.


Turkey’s Treasury and Finance Minister Nureddin Nebati has met several bank executives and the BDDK financial watchdog to discuss, in part, long-term bond holdings, two banking sources and the ministry said on Oct. 25.

The finance ministry confirmed that Nebati had "exchanged general views" with the sector officials at their meeting but did not provide details. The two sources said banks raised concerns with the minister about long-term bond holdings.

Authorities have rolled out a series of rules meant to boost lira holdings and dissuade use of hard currencies, including requiring higher bond holdings to backstop foreign exchange deposits.

The lira has tumbled about 30% this year against the dollar.

Separately, the Financial Times on Oct. 25 published an interview with Nebati in which he defended Turkey's economic relations with Russia and dismissed Western concerns that Turkey was helping Moscow circumvent sanctions.

Nebati was quoted as saying economic ties with Russia were "legal".

"Turkey is a country that acts very carefully within the international financial system. It's not a country that behaves in ways that will cause breaches of the international financial system. We're very clear on this," Nebati told the newspaper.

"Everything is coming to us through legal routes," he said.

Nebati also confirmed in the interview that Ankara had asked Moscow for a discount and delayed payments on natural gas purchases.

Western governments have raised concerns that NATO member Turkey's decision not to participate in sanctions on Russia over its invasion of Ukraine has allowed Russia to circumvent them in Turkey.