Britain officially has left EU membership since January 31. Now the eyes are on the 11-month transition period – Turkey business world in this process in which many business regulations will be made, expects a new free trade agreement (FTA) to be signed quickly with the UK from the Customs Union.
Britain’s departure from European Union (EU) membership on January 31, 2020 was the beginning of a process that the whole world will follow their curiosity. Almost all countries follow up how this process will go, especially the countries that trade with Britain, what to change in what way and what strategy to follow in separation. One of the countries, the most affected by this separation from the British in 2019 is certainly Turkey that will be about 17 billion dollars of trade.
UK, 55 countries signed the FTA, Turkey is pending
Britain, the fifth largest economy in the world, realizes 2.5 % of world exports and 3.4 % of the world imports. British Government will start negotiations on trade agreement with EU during 1 year transition period after 31 January. Negotiations will be expected to be completed by the end of 2020. Britain will continue to be in the Customs Union next year. However, it will also be able to make its own free trade agreements (FTA).
After that Britain after leaving the Customs Union, new tariffs that come into the force, will negatively affect Turkey’s exports. Therefore, Turkey is trying to sign FTA with England, as soon as possible. Until now, the British Government that has signed 18 separate FTAs with 55 countries to prevent trade damage after Brexit has not yet made a deal with Turkey.
New agreement will determine the future of its trade
About England-Turkey relations in the period after Brexit, it is expected literally a new era. The trade volume of approximately $ 17 billion between the two countries is likely to further develop in the coming period, however, in the post-Brexit period, a comprehensive trade agreement needs to be signed to improve this profitable trade relationship and minimize possible losses. Because with the end of EU membership, because the UK will leave the common market, new tariffs will come into force between the two countries, and this situation will bring serious commercial loss. Turkey business world, after Brexit, expects that it would be signed a free trade agreement (FTA) quickly to meet with new tariffs. For London, the need for new markets due to being outside the European common market and for Ankara, the desire to develop trade with the UK, which is the second most exported country in Europe after Germany, offers an opportunity to both sides. So what; first, the negotiations between London and Brussels must be concluded in order to the two parties to make a free trade agreement, according to the existing Customs Union regulations.
Turkey his country’s 2nd most exports; Britain
Britain is the second country in the EU that made Turkey’s biggest export after Germany. While exporting to Britain amounted to 10,9 billion dollars in 2019, 5.4 billion dollars were imported from this country. Automotive, ready-to-wear, electronics and chemical products take the lead in exports to Britain. In imports, mechanical power generator, automotive, metal ore, medicine and organic chemicals are at the top of the list. Ayhan Zeytinoğlu, Chairman of the Economic Development Foundation that is one of the non-governmental organizations, Turkey’s EU membership and the most closely following the Brexit process, said: ‘The transition process can be extended once for a year or two. However, the extension decision must be taken before July 1.’ Zeytinoğlu stating that the work was continuing for the regulation of commercial relations after Brexit, among British authorities and Turkey, ‘The agreement that we will negotiate with the UK and replace the Customs Union relationship, has great importance for Turkey. And he said: ‘We need to improve its scope by both preserving the current relationship and adding new sectors to this agreement.’
Rights granted by the Ankara Agreement are also in danger
Despite these expectations commercially, there are some risks that may arise for the citizens of the two countries due to Brexit and some regulations arising from the Ankara Agreement. Turkish citizens were given the right to establish and settle in community countries within this agreement signed between the European Economic Community (EEC) and Turkey in 1963. However; Turkish citizens in this country have problems with their job and settlement rights —because Britain’s partnership in the agreement will come to an end due to Brexit. Despite the fact that it is stated that the regulations arising from the agreement would continue until the end of the transition period in a recent statement by the British Embassy in Ankara, there wasn’t any clarity after Brexit. Zeytinoğlu explaining that Turkey’s citizens used the settlement rights that were given to them by the Ankara Agreement, until now, said that henceforth, the rights given to them by the Ankara Agreement would be suspended. That’s why a new regulation needs to be made urgently between the parties to prevent Turkish citizens in England from being victimized in the period after Brexit.
‘We must alert in this process’
Zeytinoğlu stating that Turkey should wait for the conclusion of the EU-British agreement due to Customs Union between EU and Turkey said that: ‘We must very alert in this process and carefully determine the negotiating position. It shouldn’t be forgotten that —if any agreement is negotiated on time and doesn’t come into force, we will rank first after the EU among the countries that will be adversely affected by the Brexit process. ‘
In the post-Brexit period, the Johnson government will faces a very challenging process in all areas. It is important that especially satisfy the audience that voted for Brexit and to prove with concrete examples that this process is really a ‘valuable step’ for England to the Brexit opponents.