Türkiye Tuesday reiterated the urgent need to update the customs union agreement with the European Union to align with the realities of the global economy and the spirit of their partnership.
The EU-Türkiye Customs Union came into force in 1995 but is limited to industrial goods and processed agricultural products. A deeper trade agreement would be expanded to services, farm goods, and public procurement.
Trade Minister Bolat acknowledged the successes achieved through the customs union but said limitations within the current deal significantly curtailed economic and trade cooperation opportunities between Türkiye and the EU.
He said that there are "permanent structural problems" in the current structure, which was originally designed as a temporary arrangement until Türkiye’s full membership in the EU.
Türkiye is the only non-EU country with a customs union agreement with the bloc. The European Commission, the EU’s executive arm, has long pushed for revamping the deal but failed to register any progress.
"We do not ignore the fact that the insufficient scope of the customs union greatly limits the economic and trade cooperation opportunities between Türkiye and the EU," Bolat told an event organized by the European Policy Centre (EPC) in Brussels.
He urged swift action and stressed that one should not linger with artificial agendas that are of no use.
"We believe that the delay in starting the process of updating the customs union has led to missed opportunities for both the EU and the Turkish business world," Bolat said.
‘Turning point’
Bolat stressed the importance of addressing systemic issues within the current deal, expanding it to include vital areas such as services and e-commerce, and building a stronger partnership contributing to economic security and strategic autonomy, as well as green and digital transformation goals.
Highlighting its pivotal role, the minister said the agreement "has been a turning point in the trade and economic integration between Türkiye and the EU," increasing the trade volume from $30 billion dollars in 1995 to a record high of nearly $200 billion in 2022.
"With the establishment of the free movement of goods, the customs union has provided EU companies with access to Türkiye's rapidly growing market under very favorable conditions compared to other partners.
In addition, Türkiye’s industrial capacity to produce in accordance with EU standards, its geographical proximity to the EU, and its young, skilled human capital have increased the competitiveness of the EU and its enterprises in global markets," said Bolat.
However, he again emphasized the urgency of updating the deal to address global economic realities, enhance the partnership between Türkiye and the EU, and ensure sustained economic growth for both parties.
"We must update the customs union in a way that is in line with the realities of the global economy and the spirit of partnership, and move beyond the current impasse," he said.
Technical discussions are ongoing to formulate a roadmap for addressing trade issues within the framework of the current trade deal, according to the minister
Untapped opportunities
Bolat referred to the 60th anniversary of the Ankara Agreement, which established the partnership between Türkiye and the bloc. He reaffirmed Ankara's commitment to full membership and highlighted the strategic importance Türkiye places on its relations with the European Union.
Türkiye has been an official candidate to join the European Union for 24 years, but accession talks have stalled in recent years over several disagreements and political roadblocks. Türkiye suggests it has fulfilled most of the criteria for the membership.
Though the accession process stalled, Türkiye has remained a key economic and defense partner for the 27-member bloc.
Bolat emphasized the balanced and sustainable nature of this partnership, underlining its positive impact on both Turkish and EU businesses.
Despite all the achievements, he said they "believe that there are still untapped opportunities to expand our economic and commercial partnership and improve relations between our respective business circles."
Bolat arrived in Brussels on Tuesday to hold a range of talks to address bilateral trade and economic cooperation and explore opportunities to deepen relations.
He met Paolo Gentiloni, the EU commissioner for the economy, and was expected to hold discussions with European Commission Executive Vice President and EU Trade Commissioner Valdis Dombrovskis and EU Enlargement Commissioner Oliver Varhelyi.