Coal Controversy: NATO Member Turkey's Trade with Russian-occupied Ukrainian Regions

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Data reviewed by Reuters indicates that Turkey, a member of NATO, imported coal worth $14.3 million from regions in Ukraine occupied by Russia this year. This development brings to light Turkey's complex relationship with Russia and Ukraine, especially in the backdrop of the ongoing conflict.

Tangled Trade Relations: What The Numbers Say

From February to July 2023, approximately 160,400 tons of coal originating from the annexed eastern Ukrainian territories of Donetsk and Lugansk found their way into Turkish ports.

Three coal producers, whose names appeared in the customs data, verified their shipments from these territories to Turkey within that timeframe. Commercial data further revealed that Turkey was the major recipient of coal exports from these annexed regions, absorbing a whopping 95% of the shipments.

Interestingly, while coal sellers have registrations in both Russia and the occupied Ukrainian territories, the buyers' list does not feature any Turkish companies. Instead, the purchasing entities are registered in offshore jurisdictions like Hong Kong, the UAE, Belize, and the British Virgin Islands.

As to the final users of this coal, the trail goes cold. To complicate matters, while the US and the European Union have stringent restrictions against trading with Moscow or the occupied regions, Turkey has not put such constraints in place.

The Energy Dilemma: Turkey's Growing Dependence on Coal

One cannot discuss Turkey's coal imports without touching on its growing energy needs. Despite global efforts to transition to greener energy sources, Turkey seems to be moving against the current.

The nation saw a significant surge in its coal-based electricity generation this year, with an increase of 25% compared to the same period in 2022, totalling 31.5 million MWh.

Navigating Geopolitical Strains

While Turkey has consistently reiterated its support for Ukraine's territorial sovereignty and even played a pivotal role in attempted peace negotiations, its trade activities tell a different story.

It's not just coal – in the past, leaders of the so-called Donetsk People's Republic have alluded to exports to Turkey, which were then relayed to Middle Eastern and African markets. In response to Russia's aggression, both the US and EU have instituted punitive measures.

Not only have they banned trade with the annexed regions, but they have also slapped sanctions on companies they believe aid Moscow's war efforts, including Turkish entities.