IstanbulTurkey has enormous potential in the gold sector, as it is one of the countries rich in natural resources capable of significantly supporting its economy. However, the production of the yellow metal faces increasing challenges that have affected production capacity, despite the increasing local and global demand for this precious metal.
Turkey began its journey in producing gold in 2001 from the Bergama-Ovacik region, and from then until 2024, it succeeded in producing 517.3 tons of gold, according to data from the Gold Miners Association.
The announced data indicate that production operations are currently taking place in 20 regions, with plans to open 10 new sites soon to enhance production.
Türkiye is home to a number of important mines, most of which are concentrated in the Aegean, Eastern Anatolia, and Black Sea regions.
Most prominent mines
- Kışladag in Uşak Province, which is considered the largest gold mine in Europe, began production in 2006 with an annual production rate of about 13 tons.
- It is followed by the Chopper mine in Erzurum, which began operation in 2010 and annually produces about 6.5 tons.
- Ovacik mine in Izmir, which is the first gold mine in Türkiye, where production began in 2001, is one of the oldest and most productive mines.
Production decline
The head of the Turkish Gold Miners Association, Hasan Yucel, said that the production of the precious metal witnessed a noticeable decline from 42 tons in 2020, the highest level in the country’s history, to 36.5 tons in 2023, then only 32.2 tons in 2024, which reflects a loss of 10 tons. Within 5 years.
Yugal added that the local demand for gold in Turkey amounts to 160 tons annually, while local production was only able to cover 32.2 tons of this demand in 2024, leading to a large gap of 127.8 tons that will be filled through imports.
Yucel explained that Turkey has huge natural reserves of gold that have not yet been extracted, estimated at 6.5 thousand to 10 thousand tons, with an economic value estimated at 397 billion to 611 billion dollars.
Yugal explained that these resources, hidden in the ground, represent a strategic opportunity that can be exploited by enhancing mining and exploration operations to stimulate the national economy.
As for official reserves, press reports stated that the Turkish Central Bank’s gold reserves witnessed a noticeable increase by the first week of January 2025.
The value of these reserves increased by more than one billion dollars to reach 65.3 billion dollars, compared to 64.3 billion dollars at the end of last year.
According to the same reports, the total gold reserves at the Central Bank reached 771 tons by January 2025.
The Central Bank had started the year 2024 with a reserve of 479 tons, which means adding 292 tons of gold over the past year. However, the central bank has not yet released its official report to confirm these numbers.
In this context, a source in the Turkish Ministry of Energy and Natural Resources confirmed that the decline in gold production in recent years is due to multiple factors, most notably the restrictions imposed on some environmentally sensitive areas, in addition to the technical challenges facing exploration and production operations.
However, the source stressed that efforts are continuing to overcome these obstacles through strategic plans aimed at increasing production.
The source indicated in an interview with Al Jazeera Net that the ministry is working to achieve the goal announced by President Recep Tayyip Erdogan in 2021, which is to raise gold production to 100 tons annually during the coming years.
He stressed that the Turkish government is focusing on empowering local manufacturers and enhancing their competitiveness by providing them with the necessary support, including easing restrictions on importing gold within the quota system, to ensure the provision of raw materials required to support the jewelry sector and exports.
At the conclusion of his statement, the source indicated that the ministry is committed to developing infrastructure, improving the investment environment, and encouraging innovation in the mining sector, with the aim of achieving sustainable growth and transforming the gold sector into one of the basic pillars of the Turkish economy.
Gold imports
In August 2023, Türkiye imposed quotas on imports of unprocessed gold, in an attempt to reduce the trade deficit and boost foreign exchange reserves.
Last Monday, the Turkish Minister of Treasury and Finance, Mehmet Simsek, announced in a press statement that restrictions on importing gold will be gradually eased, indicating that import operations within the quota system will be subject to monitoring during the next six months.
The minister confirmed that imports of unprocessed gold decreased in 2024 by 53.5% compared to the previous year, as its value fell from $30 billion to $17 billion. Accordingly, it was decided to increase the total monthly quota of gold imports by two tons, to reach 14 tons as of February. Next.
According to data from the Turkish Statistics Authority, from 2001 until the end of 2023, Turkey spent approximately $197.2 billion on gold imports, while its exports during the same period amounted to $72.2 billion, making net gold imports $125 billion.
In 2023, non-cash gold imports increased by 46.9% compared to the previous year, reaching $30 billion and $16.8 million, which is the highest annual level recorded by gold imports.
Although gold exports rose to $4.3 billion, net imports reached $25.6 billion, exceeding the previous record of $25.2 billion in 2020.
According to the ranking of the largest sources of gold imports to Türkiye during the last decade (2013-2023), they are as follows:
- Switzerland with $58.1 billion.
- UAE with $42.7 billion.
- Iraq with 15.6 billion dollars.
As for Turkish exports, they amounted to $45 billion during the same period, most of which went to the UAE ($16.1 billion) and Switzerland ($11.6 billion).
Regulatory obstacles
Economic analyst, Mustafa Akç, said that the decline in gold production in Turkey to 32.2 tons annually, despite the presence of reserves estimated at between 6.5 thousand and 10 thousand tons, shows that Turkey possesses enormous natural resources that are not sufficiently exploited.
He explained, in an interview with Al Jazeera Net, that this gap is mainly due to bureaucratic obstacles and regulatory restrictions that hinder the exploitation of these resources, noting that the long procedures for obtaining licenses, the requirements for environmental impact assessment reports, the lack of infrastructure, in addition to an unclear regulatory environment, All of these are factors that make investing in the sector less attractive.
Akç pointed out that Türkiye’s heavy dependence on gold imports to meet domestic demand is considered one of the main reasons that increases the trade deficit, and that this matter can be addressed through:
- Enhancing local processing by developing gold processing facilities locally, to transform it into value-added products such as jewelry, which increases revenues from exports.
- Encouraging exports by signing new trade agreements and increasing incentives provided to exporting companies, which contributes to enhancing Türkiye’s competitiveness in the international market.
- Strengthening the local supply chain and relying on local suppliers in production and manufacturing processes, which reduces the drain of foreign currencies and supports the national economy.
