Russia's hidden dollar reserve: Nuclear plant or sanctions dodge?
The Wall Street Journal reported that Russia aimed to create a "dollar reserve" in Turkey to finance the construction of a nuclear power plant. In this manner, the Kremlin sought to circumvent sanctions imposed by the United States. The funds were intended to support further military operations.
"WSJ" described the strategy whereby Russia attempted to dodge sanctions with Turkey's assistance. According to the journal's findings, the representatives from the two countries agreed that Gazprombank, which was not sanctioned at that time, would provide a loan of approximately nine billion dollars for the construction of the "Akkuyu" nuclear power plant. Rosatom, the Russian state agency overseeing the collaboration of research centres and institutions for the civilian use of nuclear energy, is involved in constructing this facility.
The money was to be deposited into the account of Turkey's largest state bank, Ziraat, and then transferred to Russian companies that also held accounts in this bank. The Russian Central Bank was secretly set up to finance this loan. The goal of this operation was to eliminate the need for transferring funds in and out of American banks. In this way, Turkey increased the supply of dollars in its financial system.
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"WSJ" reports that, ultimately, the Russians succeeded in transferring money through two American banks. Gazprombank sent three billion dollars to the accounts of the nuclear power plant in Turkish "Ziraat" through Citigroup, while another two billion were transferred via JPMorgan. Another tranche worth 2 billion dollars was blocked, with the funds frozen.
The US wanted to confiscate this money, but according to the American newspaper, Joe Biden's administration did not agree to this measure. They did not want to provoke Ankara and damage relations with Turkey, as it still plays a vital role in Middle Eastern politics and security, which is significant for the United States. The mentioned funds remain frozen.
After freezing the foreign reserves of the Central Bank in February 2022, its head, Elvira Nabiullina, along with state corporations, received direct instructions from the Kremlin to find ways to utilize these funds. As suspected in the USA, other high-ranking Russian officials and one of President Recep Tayyip Erdoğan's key advisers – Director of National Intelligence İbrahim Kalın – may also have been involved in the scheme.
Sanctions against Gazprombank were imposed in November 2024. Restrictions also covered six of its foreign subsidiaries. Until then, it was the only bank enabling settlements with buyers of Russian gas from so-called "unfriendly" countries. Sanctions against Rosatom in the USA have still not been introduced. Rosatom assures that the funds allocated to the nuclear power plant were used to finance the project and pay contractors and other obligations.
