Free trade agreement between Turkey and the UK
* Photo: Anadolu Agency (AA)
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Turkey and the United Kingdom (UK) signed a free trade agreement yesterday (December 29), set to go into effect on January 1, 2021.
As reported by the state-run Anadolu Agency (AA), "This is a historic day for Turkey-UK relations," Turkey's Trade Minister Ruhsar Pekcan said in a speech to the virtual signing ceremony based in Ankara.
The landmark deal will ensure stronger trade between Turkey and the UK in the days to come, Pekcan underlined, adding that it leaves no uncertainty in the trade structure between the two countries.
"We are taking the first step towards further deepening our ties while maintaining 25-year gains from the Customs Union," said Pekcan, referring to Turkey's 1995 Customs Union with the European Union (EU), which Britain is making its final exit from this week.
"With the new deal, Turkey and the UK are pleased to meet businesspeople's expectations and to keep our promises," Pekcan added.
While the negotiations have been reportedly ongoing for 3 years, Turkey's Customs Union relations with the UK will also end on January 1.
'Turkey is eager to expand the pact'
Absent a deal, about 75 percent of Turkey's exports to UK would be subject to tariffs, causing losses of some 2.4 billion dollars, but the deal eliminates this risk, said Minister Pekcan, adding, "We reached a tariff-free agreement, as planned, which includes all industrial and agricultural goods."
Stating that the trade volume between the two countries hit 15.1 billion dollars in January-November 2020, Pekcan said that in 2019, Turkey's exports to the UK – its second-largest export market – stood at 11.3 billion dollars, while imports totaled 5.6 billion dollars. The UK's investments in Turkey are around 11.6 billion dollars, she added further.
"I hope the deal will be reflected positively in bilateral investments," underlined the Trade Minister.
Pekcan also said Turkey is eager to expand the pact in areas such as investments and services. "We will discuss how we can improve the conditions for entering the agricultural market as well," she added.
'A new page in the cooperation'
Britain's Trade Minister Liz Truss also said that the pact lays the groundwork for a more ambitious UK -Turkey trade relation in the days to come.
"The agreement is part of our plan to put UK at the center of a network of modern agreements with dynamic economies," she noted, saying that there is greater trade potential in finance and biotechnology.
"In this sense, I believe that as two trading countries, from products, vehicles to other sectors, we can gain great momentum in the field of services and technology trade much faster," added Truss further.
She also said that Britons will be able to buy high-quality products, including white goods, manufactured in Turkey.
"Apart from this, it will also make a great contribution to the consumers to buy decent products at decent prices in agricultural products."
Truss said that in the last two years, in the countdown to Brexit, the UK reached agreements with 62 countries – and the European Union – to cover £885 billion (1.20 trillion US dollars) of the UK trade.
"We are not only accelerating trade but also aiming to grow. Today we open a new page in the cooperation between Turkey and the UK."
'Vital supply chains will be protected'
In a statement following the signing, the UK government said that the deal covers trade worth more than £18 billion (24.3 billion USD).
"Both countries have also committed to working towards a more ambitious free trade agreement in the future, which will go further than the current deal," said the statement, adding that the vital UK-Turkey supply chains will also be protected for automotive manufacturers, such as Ford, which employs 7,500 people in the UK. (PT/SD)