2023-05-25 10:30:34
Dubai: UAE is one of the major markets for gold internationally. Even though it is lagging far behind in gold production, the Gulf nation is leading in sending gold to many countries including India. This is mainly due to the fact that traders are sourcing large quantities of gold for sale in the UAE to take advantage of the benefits in the tax structure.
Many countries are selling their gold through UAE. In this way, the information of the gold exported by Russia to the UAE in the past years has now come out. Records show that in the year since the start of the war in Ukraine, Russia imported 75.7 tons of gold worth $4.3 billion. Interestingly, before the Ukraine war, it was only 1.3 tons.
Russian gold has been imported in large quantities not only in the UAE, but also in China and Turkey. Between February 24, 2022 and March 3, 2023, gold was imported at a rate of around 20 tonnes each. Along with the UAE, these three countries accounted for 99.8% of Russian gold exports during the period, according to customs data.
Western sanctions on Russia in the wake of its invasion of Ukraine have led to cuts to traditional export routes. Documents detailing nearly 1,000 gold exports in the year since the start of the war in Ukraine have been released.
In the days since the start of the Ukraine conflict, many multinational banks, logistics providers and metal refineries have stopped handling Russian gold, a setback for Russia. It was usually shipped to London, known as the gold trading and storage center of Europe.
But following the invasion of Ukraine, the London Bullion Market Association banned Russian-made bars from March 7, 2022. Following this, at the end of August, Britain, the European Union, Switzerland, the United States, Canada and Japan also banned Russian gold imports. With this, Russian gold producers quickly found new markets in countries such as the UAE, Turkey, and China that did not impose sanctions on them.
At the same time, Louis Marechal, a gold sourcing expert at the Organization for Economic Co-operation and Development, said that Russian gold imported by the UAE and other countries is likely to be melted down and re-cast to hide its origin and return to the US and European markets.
On the other hand, the gold bullion committee of the UAE government has informed that the gold has been imported following all the rules. “The UAE will continue to trade openly and honestly with its international partners, adhering to all current international standards set by the United Nations,” the Gold Bullion Committee said.
The United States had earlier warned countries including the UAE and Turkey as part of an effort to further isolate Russia. Doing business with firms subject to US sanctions might mean losing access to G7 markets. Meanwhile, reports also show that Russia has produced 325 tons of gold in 2022.
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