Gold By Country:
2013 Demand: 175.2 tonnes
Jewelry/Coin & Bar Demand: 73.2 tonnes/102 tonnes
Reserves: 519.7 tonnes
% of Total Forex Reserves: 18.95%
2013 GDP: $1.2 trillion
Turkey is known as the first place to produce gold coins in human history (Kingdom of Lydia, 600-700 B.C.E.) The Turkish relationship with gold is interestingly colored by its ties to the Ottoman Empire, which spanned six centuries and wielded immense power over the Persian Gulf and surrounding regions. Historically, this region always served as an intermediary between East and West, especially in trade. As a result, the Turkish people are intimately familiar with gold coins, which the State Mint produces in staggering numbers.
Until the end of the First World War, Turkey was still formally organized as the Ottoman Empire, which dates back to the 14th century. At its height, the empire's territories spread across the Mediterranean and the Middle East, while the capital city of Constantinople (present-day Istanbul) remained on the peninsula known as Anatolia, or what is now the state of Turkey. After establishing a government mint in 1452, the Ottomans began to mint coins and dominate the trade route between East and West known as the “Silk Road.” Today, the very same Turkish State Mint is the world's most prolific manufacturer of gold bullion coins, or highly pure gold coins made for investment. More gold coins have been produced by the State Mint over the past 15 years (181 million between 2000-2012) than anywhere else in the world, though these coins are largely unknown to Westerners.
The Mint strikes two versions of its gold coin, the Meskuk (standard) and the Ziynet (ornamental). Collectively, they are known as “Republican gold.” The latter is far more decorative, is often sold with a hook and a ribbon in order to be worn, and is bought in far greater numbers than its standard counterpart. Both are 22 karats, or .917 fine gold. Millions of Meskuks and Ziynets are sold each year, predominantly to the Turkish public. Internationally, Turkish companies sold $1.27 billion (or about 30 tons) of gold to Switzerland in March of 2014, the majority of which is generally believed to be bound for Iran.
It is no accident that Turkey produces more gold bullion coins than any other government on earth; most of these gold coins are made for domestic demand, as the Turkish people consumed in excess of 100 tons of gold coins and bars in 2013. Remarkably, the amount of gold held in the private possession of Turkish citizens dwarfs the nation's official gold reserves by about 10-to-1, with an estimated 5,000 tons of gold in the hands of the public. Gold is held as a means of wealth preservation, but it has an equally vital role as an appropriate gift for important occasions. The use of gold coins in jewelry is a common practice among Turkish families, as many choose to place the ornamental Ziynet coins in pendants, lockets, charms, necklaces, and other adornments.
Did You Know?
Turkish gold is characterized by the State Mint's 22-karat “Republican gold” coins. Although more of these coins are produced each year than any other gold coins in the world, they are avidly purchased by the Turkish public and are largely unknown to the international community. Two varieties are available, known as Meskuks and Ziynets, where the former is a “standard” coin and the latter is more ornamental and decorative. Ziynets are frequently worn on clothing or as necklaces, and are regularly given as gifts. The most common Turkish gold coin is the kurush, which was produced en masse from 1950-1980. The kurush was struck in several denominations that were multiples of 25 including 25,50,100,250, and 500.