Ankara, London to negotiate landmark free trade deal to include more sectors
While the trade ties between the U.K. and Turkey continue at full speed, the landmark free trade agreement is planned to be renegotiated to include more sectors in the next two years.
The U.K. officially quit the EU after 47 years of membership on Jan. 31, 2020, as the 27 members of the bloc approved the Brexit deal on Nov. 25, 2018.
On Dec. 24 last year, the U.K. reached a post-Brexit trade agreement with the EU in a bid to prevent commercial losses after the divorce.
A few days later on Dec. 29, the country signed a historic free trade agreement with Turkey.
According to the Turkish Statistical Institute, Turkey's exports to the U.K. rose by 28% year-on-year to $9.7 billion in January-September, while its imports from the country increased by 4.5% to $4.2 billion in the same period.
Brexit has not affected the U.K.’s trade relations with Turkey thanks to the historic free trade agreements, Chris Gaunt, chairman of the British Chamber of Commerce in Turkey (BCCT) said.
He pointed out that the deal has a clause to enhance and improve the free trade agreements.
"So there's the opportunity within the next two years to renegotiate the free trade agreements between Turkey and U.K. to include more sectors and give more opportunity for both Turkish companies and U.K. companies."
Agriculture, pharmaceuticals, technology, and financial services are areas that offer great potential for both countries, he said.
"Hopefully, we can start to include these in the new free trade agreement negotiations," Gaunt expressed.
The trade ministers of the two countries will meet in the next six to eight months to start the renegotiation process, he stated.
The technology sector in Turkey is growing very quickly, he underlined, adding: "It is becoming a major force within Europe. So the potential for Turkey and U.K. to grow their trade is still very big. And we want to create an environment whereby we can realize that potential over and above what we currently have."
Despite the COVID-19 pandemic’s impact on bilateral trade, Gaunt said there is no lack of appetite to boost the trade volume.
"The U.K. is Turkey's second-largest export market. Hopefully in the future U.K. will be Turkey's biggest export market," he said.
Responding to a question on some global companies shifting their production centers to Turkey, Gaunt said Turkey offers a great opportunity and alternative for the Far East, particularly for China.
"Having something closer with shorter lead times and more flexibility, obviously, is attracting a lot of attention for U.K. companies, and Turkey as all the attributes, it takes us ticks all the boxes, you know, it's got a strong manufacturing base, it's got a well-educated workforce. Technology is becoming a far bigger part of the way Turkey, Turkish manufacturers operate," he said.