Turkey is seeking to switch to payments in national currencies for $10 billion worth of trade with neighbouring Iran to lessen exchange rate risks and bolster trade volumes, a Turkish government source said on Friday.
Turkey has made similar proposals to China and Russia in recent months.
Iran proposed earlier this week during a visit by Turkish Prime Minister Tayyip Erdogan that the two countries should conduct bilateral trade in their own currencies as part of widening economic ties.
Bilateral trade jumped to $10.3 billion in 2008 from $2.4 billion in 2003, with Turkey running a large deficit largely due to its gas imports. Ankara and Tehran aim to boost the volume to $20 billion in the next few years. [continued...]
Iran and Turkey signed a number of deals on Wednesday to facilitate the efficient flow of gas through Turkey to Europe, including accords on allocating some of Iran’s South Pars gas field to the Turkish Petroleum Corporation (TPAO), allowing Iranian gas to be transported via Turkey and allowing Turkmenistan’s natural gas to be pumped to Turkey via Iran, during Turkish Prime Minister Recep Tayyip Erdoğan’s visit to Turkey’s southeastern neighbor.
Turkish Energy Minister Taner Yıldız said the deals provided advantages for Turkey in the use and the sale of some phases of the South Pars gas field. “Its conditions and prices will be negotiated later,” the minister added. Iran, which has the world’s second-largest natural gas reserves, is Turkey’s second-biggest supplier of natural gas after Russia. Turkey had signed a preliminary deal in November 2008 for Iranian gas to be exported to Europe through Turkey and for Turkey to produce gas in the South Pars field.
The investment would amount to $3.5 billion. But this deal has been delayed by objections from the United States, which opposes new energy deals in Iran as part of Western efforts to isolate Tehran over its nuclear program. [continued...]