Russian SME Trader Investments In Turkiye Increase Five-Fold In 2022
The registered capital volume and numbers of foreign invested companies with Russian capital, registered in Turkiye from January through May 2022, has increased by nearly five times, compared to the same period of the 2021, according to the Turkish Chamber of Commerce and Industry (TOBB).
According to TOBB, this figure reached 347 companies, up by 278. The total capital of the mentioned companies registered in Turkiye in the first five months of this year amounted to 203.1 million Turkish liras (US$11.7 million), compared to the same period of 2021 (32.9 million Turkish liras or US$1.9 million).
Most of the companies with Russian capital registered in the country based themselves in Istanbul (248). Their total capital equaled 52.4 million Turkish liras (US$3 million). This relatively low figure suggests these are small traders wishing to secure supply chains in the wake of Russian logistical problems.
Of the total number of registered companies, 187 are engaged in the wholesale and retail trade, 44 in the sphere of information and communications, while 24 are in the education and trade. The remaining Russian invested companies are involved in other sectors of the economy.
Turkiye is Russia-friendly in terms of business, with Russia being one of its largest trade partners. The country allows Russian nationals and companies to establish bank accounts.
Turkiye has free trade agreements with the EFTA, Israel, Macedonia, Bosnia-Herzegovina, Palestine, Tunisia, Morocco, Egypt, Albania, Georgia, Montenegro, Serbia, Chile, Mauritius, South Korea, Malaysia, Moldova, Faroe Islands, Singapore, Kosovo, Venezuela and the United Kingdom, meaning that Russian trading SMEs are establishing subsidiaries to beat EU sanctions and widen their trading base to additional new markets. Many of these SMEs will have Turkic roots, with several Russian cities such as Kazan and the Volga River region possessing significant ethnic Turkish populations.
Russia Briefing is written by Dezan Shira & Associates. The firm has 28 offices throughout Eurasia, including China, Russia, India, and the ASEAN nations, assisting foreign investors into the Eurasian region. Please contact Maria Kotova at email@example.com for Russian investment advisory or assistance with market intelligence, legal, tax and compliance issues throughout Asia.