Estimated worth of Turkey's hidden gold hoard approaches half a trillion dollars
The Istanbul Jewelers Chamber (IJC) has estimated the undeclared gold in Turkey to be around 5,000 tons, equivalent to a staggering $500 billion in value. This hidden treasure, held mostly by households outside formal banking or government records, dwarfs the official gold reserves held by Turkey’s Central Bank and exceeds the gold deposits recorded in Turkish banks.
With a population of approximately 85 million people and over 20 million households, the volume of gold stashed privately, often known as "under-the-mattress" gold, appears rational. The IJC President, Mustafa Atayik, used these figures to support the gold reserve projection, stating that the 5,000 tons is the most realistic estimate, with later estimates ranging from 6,500 to 7,000 tons.
The process of involving jewelers in bringing under-the-mattress gold into the economy has been ongoing for over a decade. This is because, as Atayik suggests, the continued preference for keeping savings under mattresses is due to insufficient confidence. In ministry meetings, it was revealed that banks could not maintain sufficient expert personnel on this matter, leading citizens to use their preferred jewelers instead.
Turkey's gold market dynamics are significantly shaped by this domestic, undeclared stockpile. While specific recent figures on Turkey’s gold imports are not detailed in the available data, the scale of this hidden gold reserve emphasizes how much gold remains outside formal channels.
The value-added products created from gold imported into the sector range from $2,500 to $5,000 per kilogram, making it Turkey's most valuable export unit value products. However, it's important to note that not all imported gold in Turkey serves the jewelry and jewelry sector's demand.
The gold mining sector in Turkey is also growing, with the gold miners association reporting 18 separate gold mine sites with completed feasibility studies and applications as of 2023. Domestic gold production and scrap recycling can increase, meeting raw material requirements without foreign exchange outflow or import necessity, further reducing the need for gold imports.
In conclusion, Turkey's hidden gold reserve is a significant portion of the country's total gold holdings, much of which remains untracked and untaxed. This hidden treasure, worth around half a trillion dollars, is a testament to the nation's love for gold and the role of jewelers in bringing it into the formal economy.
[1] Istanbul Jewelers Chamber (IJC) press release, date unknown [2] Central Bank of the Republic of Turkey, Annual Report 2023 [3] Turkish Statistical Institute, Banking Sector Balance Sheet, date unknown
- The Turkish economy, particularly the gold market, is heavily influenced by the undeclared gold, estimated by the Istanbul Jewelers Chamber (IJC) to be approximately 5,000 tons,worth around $500 billion, which holds a significant portion of Turkey's total gold holdings.
- In Istanbul, a bustling business hub, jewelers play a crucial role in bringing the "under-the-mattress" gold, held by households outside formal banking records, into the formal economy, a process ongoing for over a decade due to insufficient confidence in the banking system.
- In the near future, the growth in Turkey's gold mining sector, with 18 separate gold mine sites, could potentially increase domestic gold production and scrap recycling, meeting the sector's raw material requirements without the need for foreign imports, further shaping the dynamics of Turkey's gold market.
