The government supported the Free Trade Agreement between Ukraine and Turkey
On February 2, at a regular meeting, the Cabinet of Ministers of Ukraine approved the draft Free Trade Agreement between Ukraine and Turkey. This was reported by the press service of the Ministry of Economy.
“Thanks to the agreement, all friendly countries of the Black Sea basin - Georgia, Moldova, Bulgaria, Romania, Turkey and Ukraine - will be connected by free trade agreements with common rules. Therefore, the document is of great importance for the entire region. Strengthening the strategic partnership between Ukraine and Turkey will open up new economic and geopolitical prospects, as well as strengthen our positions, which is very important in the context of the intensification of Russian aggression,” said Yulia Sviridenko, First Vice Prime Minister and Minister of Economy of Ukraine.
The key position of the agreement is the establishment by Turkey of 0% duties on 10,337 commodity items, which is 95% of the total number of goods exported by Ukraine. In addition, tariff quotas or reduced duties will be applied to another 1,348 commodity items.
Thanks to the establishment of a 0% duty on the supply of grain by Turkey, Ukraine will receive improved conditions for access to the Turkish market for processed agricultural products. The agreement also provides for the complete abolition of Turkish duties on industrial products.
To ensure the development of domestic metallurgy, Ukraine reserved the right to apply an export duty on the export of scrap metal. At the same time, Turkey is opening up the domestic market for our metal. For 510 out of 840 metallurgical goods, a zero duty is set. Another 130 have been partially reduced in duties, which gives us advantages over Russian metal. For 167 metallurgy products, quotas of at least 411,000 tons are provided.
In addition, Ukraine maintains duties on used cars and second-hand goods and establishes three and five year transitional periods of duties on vehicles and light industry products. Also, the goods produced from Turkish raw materials after the activation of the agreement will be considered Ukrainian and will be able to enter the markets of all European countries duty-free, according to the EUR1 certificate.
The agreement will have an overall positive effect on the Ukrainian economy. In industries that will work for export, new jobs will be created, added value will be generated, taxes will be paid. According to preliminary forecasts, the agreement will annually give +2.2% to GDP and +2.6% to household income.
“The introduction of new rules will create new realities for Ukrainian industries. For a softer and gradual reorientation of a number of industries, the Ministry of Economy has developed an appropriate package of decisions,” Yulia Sviridenko added.