JEDDAH: Hundreds of Iranians have set up new businesses in Turkey to evade crippling US economic sanctions.
More Iranians than any other nationality registered foreign companies in Turkey in the first 10 months of this year, according to new data from the Union of Chambers and Commodity Exchanges of Turkey.
Out of 10,682 opened from January to October, more than 800 were registered by Iranian citizens — 49 publicly listed and 772 private limited companies,
“A significant number were set up to bypass US sanctions,” a leading Turkish economist told Arab News. “In that period, 821 Iranian companies were established with a total capital of only 116 million Turkish lira ($19.5 million), an insignificant sum to establish a company under normal conditions.”
The new companies are mostly in the wholesale and retail sectors, and 677 were established in Istanbul. The others were set up in the capital, Ankara, the Mediterranean resort city of Antalya, the northwestern industrial hub of Bursa, the Aegean port city of Izmir, the eastern city of Van bordering Iran, and the southern port city of Mersin.
“When they establish companies in Turkey, they have the chance to get around the problems they face in money transfers through European and US banks, especially if the amount is more than $10,000,” the economist said.
International sanctions on Iran were eased in 2015 under the Joint Comprehensive Plan of Action (JCPOA), the agreement with world powers to curb Tehran’s nuclear program. However, US President Donald Trump withdrew from the JCPOA in May 2018, and has gradually reimposed sanctions that have crippled the Iranian economy.
Turkish President Recep Tayyip Erdogan opposes the US sanctions, and wants to triple Turkey’s annual trade with Iran to $30 billion. The two countries’ central banks formally agreed in October 2019 to trade in their local currencies.
Foreign Minister Mevlut Cavusoglu said in April that Turkey was looking for new trade mechanisms with Iran, such as INSTEX (the Instrument in Support of Trade Exchanges), the system proposed by European countries to bypass US sanctions with non-dollar trade.