An Outdated Customs Union: EU and Turkey to Revamp Trade Ties

Written by | Thursday, May 14th, 2015

The European Union and Turkey have agreed to revamp a 20-year-old customs union as Brussels pledged to address Ankara’s concerns about the EU’s Transatlantic Trade and Investment Partnership (TTIP) with the United States. The customs union was established in 1995 as the first step towards the accession talks with the EU but Turkey now complains that it is obsolete. Turkey has been an official candidate for EU membership since 1999, yet the process has been deadlocked for a long time by some EU member states.

In the negotiations, EU Trade Commissioner, Cecilia Malmstroem, and Turkish Economy Minister, Nihat Zeybekci, formulated a roadmap to enlarge the customs union by including government contracts, most agricultural goods, and services. Mr Zeybekci said that his country had not given up on becoming a full EU member but its greatest concern was the TTIP. “Turkey would like to be in the league of the world economic powers, therefore Turkey would very much like to take part in the TTIP process,” Turkish minister explained the concerns.

Both sides said that they were committed to bringing the outdated customs union “into the 21st century”, which is supposed to boost mutual relations between the EU and Turkey. Commissioner Malmstroem also stressed that Brussels would keep Ankara informed about its TTIP talks but emphasized that Turkey could not be involved in the negotiations until after the EU and the U.S. finish the difficult discussions themselves. Ms Malmstroem also said that the EU “had been very careful to inform Turkey of every stage in negotiations (with the U.S.).”

The EU is Turkey’s number one trading partner in both imports and exports while Turkey is the EU’s 7th most important import market and 5th most important export market. Turkey exports mostly machinery, transport equipment and manufactured goods to the block while EU’s exports to Turkey include machinery and transport material, manufactured goods and chemicals.

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