The connection between Russian sanctions and bizarre Turkish monetary policy

Russian cash has uses beyond the obvious

People relax on deckchairs on Caddebostan beach on the Bosphorus coast on the Asian side in Istanbul on July 28, 2022. - Istanbul, a historic megalopolis of 16 million people resting between two continents and two sea, does not bring to mind immediate images of a beach resort. But just like the locals of New York, Beirut and a handful of other global cities, Istanbulites can swim all summer long and return home on the metro with salt layering their skin, sand trapped under their sandals. (Photo by Ozan KOSE / AFP) (Photo by OZAN KOSE/AFP via Getty Images)

Aug 25th 2022|ISTANBUL

Many countries are moving away from Russia, but one is getting closer: Turkey. Russian tourists and émigrés are pouring into Istanbul and the country’s coastal resorts, snapping up properties by the thousand. Russia is helping to fund a nuclear plant costing $20bn in Akkuyu, in the south. While many countries have cut exports to Russia since its invasion of Ukraine, Turkey’s have surged by 60% in dollar terms. Western firms, constrained by sanctions, appear to be using Turkey as a go-between to export to Russia.

This article appeared in the Finance & economics section of the print edition under the headline “Mates’ rates”