Türkiye and the UK are looking to start negotiations for the free trade agreement (FTA) in the first half of next year, said Turkish Ambassador to the UK Osman Koray Ertas on Wednesday, reported Turkish daily Yeni Safak.
“We will broaden the scope of the FTA,” he said in an interview with Anadolu.
“A joint committee meeting was held recently, and this political will has been officially recorded. The updated deal will further enhance the trade between the two countries, thereby strengthening our exporters in this region,” he said.
The existing FTA, signed in December 2020, predominantly covers industrial goods and has provided continuity to businesses and safeguarding of supply chains following Brexit.
But it does not cover key areas such as services, digital and data, the UK’s Department for Business and Trade said.
Ertas stressed the increasing importance of cooperation in the defense industry between the two countries.
He said Turkish defense industry companies are showing more interest in collaboration with the UK, and highlighted recent developments such as a Turkish defense industry company acquiring a British defense company.
UK, important target country for Türkiye in terms of tourism
He said one of the positive agenda items between the two is tourism, noting that approximately 3.4 million British tourists visited Türkiye last year.
He said the UK ranks 3rd in terms of the number of tourists visiting Türkiye.
“Therefore, the UK is a very important target country for us, and it holds critical importance in terms of tourism. The figures up until May of this year are encouraging. There is about a 21% increase compared to the same period last year,” he added.
He said more than 1.2 million people traveled to the country for health tourism alone last year.
Ertas also pointed out that a significant number of tourists from the UK visit Türkiye for health-related purposes every year, emphasizing the importance of the private sector in health tourism, just as in travel tourism.
Bloomberg: EU and Turkey Discuss Easing Trade Relations Amid Warmer Ties
The European Union and Turkey are discussing an update of their customs union as part of the country’s process of re-engagement to regain the trust of European partners and investors.
“There are difficult issues to be addressed in this regard,” Paolo Gentiloni, the EU commissioner responsible for customs, told Bloomberg in a statement Tuesday. “We will look into these with our teams after the summer and see whether it is possible to build on these new signals from Turkey”, reports Bloomberg in what could be the most lucrative return from President Erdogan’s new policy of making friends across the world.
EU foreign ministers signaled their readiness to work for closer ties with Turkey last month, with the bloc noting that Turkish President Recep Tayyip Erdogan had given the green light to Swedish membership of the NATO military alliance. Prior to backing Sweden’s accession, Erdogan linked Sweden’s NATO bid to Ankara’s efforts to join the EU — but EU accession is still off the table.
Josep Borrell, the EU’s foreign affairs chief, said on July 20 that resolving tensions over Cyprus will be key to the re-engagement with Turkey. Cyprus has been divided since 1974, when Turkey occupied the northern third of the island following a coup by supporters of the country’s union with Greece.
The customs union agreement provides for a common external tariff for all industrial goods, but does not apply to services, public procurement or agriculture — except for processed agricultural products. Bilateral trade concessions apply to agricultural, coal and steel products.
The European Commission, the EU’s executive arm, had long pushed for updating the trade agreement with Turkey but failed to make any progress amid the deterioration of bilateral relations and tensions in the eastern Mediterranean.
Hahn said that the process of re-engagement with Turkey and improving economic relations are also important for security reasons. “I think nobody who is realistic talks about accession, but there are many other opportunities,” he said.
Currently, 50% of Turkish exports go to European destinations, including UK. However, Turkey failed to climb the value-added ladder in her manufacturing industries, as European business stopped investing into the country, because of fraying relations with EU. A new and expanded Customs Union deal could add up to 1% to Turkey’s annual GDP.
The deal with UK is a necessity, after the latter left EU. It would set a new basis for trade relations, with a country where businesses are keen on investing into Turkey. It could also encompass a broader range of goods and services than stipulated by the EU Customs Union to the benefit of both economies.
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