The UK has secured a free trade agreement (FTA) with Turkey, adding one more deal to the tally of agreements signed with 62 countries since leaving the EU earlier this year.
The deal with Turkey is the fifth-biggest FTA the UK has negotiated with a single country, following deals with Japan, Canada, Switzerland and Norway.
The EU accord is the UK's largest deal with a single trade bloc.
Continuity
The 'continuity agreement' with Turkey replicates existing trading terms between the country — which itself has a customs union agreement with Brussels — and the UK.
Bilateral trade between the countries was worth nearly £19bn last year, according to the Department for International Trade.
Relief
One British official said there was an “immediate sense of relief” at the Turkey deal, reports the FT.
The UK is Turkey’s second-biggest export market but Ankara’s customs union with the EU meant that a FTA could not be finalised until a Brexit deal was in place, raising fears among Turkish exporters that their products could face hefty import tariffs and border delays.
According to the Department for International Trade, the new deal will secure existing preferential tariffs for 7600 UK businesses exporting machinery, iron and steel to Turkey, while protecting automotive and manufacturing supply chains.
Future developments
A review clause requires the two nations to reconvene within the next two years to discuss expanding the deal further to include services and more liberal regulations on trade and agriculture.
The deal was signed via video call and will be ratified by the respective parliaments in about a month. An exchange of diplomatic notes allows it to come into force before then.
Landmark
International Trade Secretary, Liz Truss, said of the deal: “It paves the way for a new, more ambitious deal with Turkey in the near future, and is part of our plan to put the UK at the centre of a network of modern agreements with dynamic economies.”
Turkey’s trade minister, Ruhsar Pekcan, called the deal a landmark in UK-Turkish relations.
“Without a deal, about 75% of Turkish exports to the UK would be subject to tariffs, causing the loss of some $2.4bn (£1.78bn); this risk is now gone,” he said.