Turkish Economy Minister Nihat Zeybekci and EU trade commissioner Cecilia Malmstrom, announced a framework on Tuesday for updating the customs union as they signed the agreement, which is seen as a new milestone to build on their relationship.
In an attempt to widen the sectors covered by the union, the two economies will discuss updates in the agreement. “What we aim is to have no restrictions whatsoever,” said Zeybekci.
Based on the agreement, Turkey will contribute to any decision making processes and will automatically be bound by any free trade agreement the EU and third countries sign.
Within the scope of the Customs Union agreement, any trade barriers and tariffs which prevent the trade of Turkish goods in the EU markets will be cleared by the EU.
The EU is currently one of Turkey’s largest export markets. Results in the first quarter of 2015 show that it has gained close to $20 billion worth of sales.
Turkey has also requested for additional sectors such as agriculture, service and public procurement to be re-added in the EU as they were previously abolished in 1996. "This will be the first step of the most comprehensive renewal of the agreement," added Zeybekci.
Although positive progress has been made, there is still no sign of Turkey becoming a EU member. Additionally, the two economies could not reach a deal on Transatlantic Trade and Investment Partnership (TTIP), which the EU will carry out solely with the US.
Ankara is not pleased with this agreement as they believe Turkish goods will fail to benefit from expanding into the US markets while American goods trade in the EU markets. Turkey has warned the EU of leaving the Customs Union on many occasions in the past.
“If this is a unilateral opening for the EU vis-à-vis the US, then the situation is not sustainable,” said Turkish economy minister.
Malmstrom stated that although talks will only continue with the US, Turkey will be updated on their progress on a regular basis.