Turkish and Russian Authorities Seek Alternative Payment Methods for Trade

Turkish and Russian Authorities Seek Alternative Payment Methods for Trade
Turkish and Russian Authorities Seek Alternative Payment Methods for Trade

While the Russian business people, who were faced with the embargo of the EU due to the war, turned their route to Turkey for trade, the removal of Russia from the SWIFT system caused problems in payments between the two countries. Sigma Elektrik General Manager Murat Akgül, who said that Russian buyers have closely branded Turkish companies at the Dubai MEE 2022 Fair, said, “Turkish and Russian authorized units are in search of alternative payment methods for the smooth and reliable execution of trade. On the agenda, there are options such as trade with national currencies, participation in the Russian system SPFS instead of SWIFT, and barter.

Sigma Elektrik, one of the well-established brands of the low voltage switchgear industry, participated in the Dubai Middle East (MEE) 7 fair held between 9 – 2022 March. we met. Especially the prospective customers from Russia showed great interest. The most important reason for this is the embargo application of the European Union (EU) to Russia at many points. Russia's inability to trade with countries such as France, Spain, Italy and Germany, which are the most important import markets for electrical materials, due to the embargo. There is no alternative market to these countries other than our country, where they can go. In addition, with our cost advantage in terms of logistics and production of quality products, Russian customers are turning their route to our country.”

“SWIFT system has been exited, there is a problem with payments”

Talking about the Turkish electrical equipment industry's exports to Russia, Akgül said, “As the industry, we export tens of millions of dollars a year to Russia. However, due to the war and the embargo resulting from Russia's removal from the SWIFT system, there are problems with payments. The authorities are looking for alternative payment methods to ensure that the trade with our obligatory trading partner is carried out smoothly and reliably. On the agenda, there are options such as trade with national currencies, participation in the Russian system SPFS instead of SWIFT, and barter.

“The problem should be solved in a short time”

Pointing out that it is the right time to talk about the new payment terms for the Russian market, Murat Akgül said, “This is an issue that concerns other sectors as well. Now, new ways of working with Russia should be determined and methods that will create mutual trust, such as insurance, should be determined. Although we offered various suggestions to Russian customers at the fair, we stated that it was still early to take action, but we believed that the authorized units of both countries would find a solution in a short time. They also stated that they agreed with us that a stronger trade base should be established between the two countries. If the authorities can pave the way for safe trade in a short time, we predict that our exports will increase significantly compared to previous years.”

“We aim to contribute to reducing the current account deficit of our sector”

Akgül concluded his words as follows: “When we look specifically at the Turkish electrical materials sector, our country's exports are unfortunately not even at the level of 1 percent of the total export figure in the world. In addition, the export figure of our country is far below the import figure. The current account deficit in our sector is quite high. As a domestic manufacturer, we want to expand our existing markets and open up to new markets by acting solution-oriented in exports. Thus, we aim to contribute to the reduction of the current account deficit of our sector.”

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