Representatives of foreign companies operating in Turkiye are urging a rapid modernization and expansion of the scope of the current Customs Union with the European Union, a long-awaited process that would comprehensively shake up economic relations between the sides.
The call came after a delegation of presidents of the Bilateral European Chambers of Commerce and Industry in Turkiye visited Brussels this week and presented a major report on improving trade relations between Turkiye and the EU.
The report assessed the benefits and impact of the revamped customs union between the two sides.
At a briefing on Tuesday, business leaders from Turkiye and EU countries spoke of the potential economic gains for both sides if such a review is undertaken.
“Everyone who will benefit from the future of Europe needs to take a closer look at Turkiye and invest in this country,”said Markus Slevogt, president of the German-Turkish Chamber of Industry and Commerce.
The modernization of the agreement could provide a “catalyst for a stronger relationship” between the EU and Turkiye, Slevogt noted.
The host of disagreements between Ankara and Brussels over recent years has been stalling the negotiations for the update of the customs union. A deeper 1990s-era trade agreement would be expanded to services, farm goods and public procurement.
The modernization would bring Turkiye fully into the internal market of the world’s largest trading bloc, allowing almost all goods and services to flow unhindered.
Slevogt said the current agreement remained insufficient and stressed that the update would see Turkiye contributing greatly to Europe in economic terms.
“When we think about the customs union, we have to expand it in a way that it not only expands the range of products it covers but that it also meets the needs of today’s trade,” Slevogt stressed.
He stated that with the investments made by European companies together with the customs union, Turkiye has become more integrated into Europe’s value chains, which as a result, enabled trade to multiply.
Slevogt said the expansion would be in the interest of both sides and would result in a win-win case.
Turkiye is the only non-EU country with a customs union agreement with the bloc. The deal was struck in 1995. In its Dec. 21, 2016 assessment, the European Commission proposed revamping the deal.
The current customs union agreement only covers a limited range of industrial products and excludes agriculture, public procurement, e-commerce and services.
The inclusion of these sectors is estimated to lift bilateral trade between Turkiye and the EU to over $300 billion, a substantial increase from the current $165 billion (TL 3 trillion).
“Turkiye has proven to be a reliable partner,” said Livio Manzini, president of the Italian Chamber of Commerce and Industry in Istanbul.
Stressing the global changes in geostrategic terms that have taken place, particularly in the last couple of years, Manzini said: “If you want to cut ties with China, there is no country other than Turkiye.”
He recalled that Turkiye was one the first country that signed a post-Brexit free trade agreement with the U.K., a deal that he said was negotiated during the coronavirus pandemic and within a few weeks.
“We are missing the train with the current customs union.”
For his part, Franck Mereyde, president of the Turkish-French Trade Association, said the trade agreement should be updated “immediately” to further develop trade relations between Turkiye and the EU.
He stressed that the negative news reports written about Turkiye in Europe were not in line with the facts, saying that a new strategy and framework should be established immediately for mutual trade.
Mereyde stated that with Turkiye’s commercial contributions, the EU would be stronger against China and could solve its logistical problems more easily.