Minister says Turkey to 'recorsider' EU customs union

In the first government reaction to a recently discussed issue of disadvantages arising from Turkey's European Union Customs Union (EUCU) membership, Turkish Economy Minister Zafer Caglayan said on Monday in Ankara that Turkey would need to review the membership now that it "creates unfair treatment in trade with the union." In 1996 Turkey became the first non-EU member country to join the customs union. Turkish market experts have recently voiced ideas that the EUCU terms should be reviewed. As observers also argue, the EU's goods and services come to Turkey more easily than Turkish goods and services go to Europe. This inequity is multiplied by the nonexistence of the free circulation of Turkish businesspeople in Europe. "I would like to express that if the current situation continues, we may have to put the customs union with the EU on the table for reassessment, as it is now working against Turkey," Caglayan said. The minister was speaking at a press conference following a meeting with senior officials from Germany's Baden Wurttenberg. Underlying the problems Turkey faces is the fact that the government at the time when Turkey joined the customs union failed to draw clear terms in the deal. The draft of the deal was simply prepared and presented by the EU, and Turkey signed it without negotiating the pros and cons in detail. This mistake -- referred to by Caglayan on Monday –- is now backfiring on Turkish companies. The Turkish government at the time believed joining the customs union would open the way to Turkey's full membership in the EU, one major reason why they chose to overlook some tricky terms in customs union. Some market analysts even speculated Turkey could move to exit the customs union in reaction to decades-old lingering problems of visa exemption for Turkish businesspeople and the much-discussed double standards. "The EU allows businessmen from many non-member countries to enter countries of the union, while Turkey is exempt from this list. … This is applying double standards and is unfair," Caglayan asserted. One critical complaint regarding the customs union from Turkey's perspective, as Caglayan also stressed on Monday, is that the EU does not include Turkey in free trade agreements (FTAs) with third countries. Turkey has to negotiate on its own with third countries. Mentioning an envisioned Transatlantic Free Trade Area (TAFTA) between the EU and the US, Caglayan said the government is concerned over the possible side effects of the deal on Turkey-US trade relations. "Prime Minister Recep Tayyip Erdogan sent a letter to US President Barack Obama, sharing concerns to this end. We would like to see visas be completely lifted for Turkish businessmen in the EU rather than better conditions in visa procedures after this point." Talks for a possible FTA with the US independent from the EU, however, might have its own disadvantages for Turkey, such as the need for new investments, since the US will likely require improved manufacturing standards of trade goods. Also touching on the Israeli apology over the Mavi Marmara incident, Caglayan said he hoped normalization of diplomatic relations with Israel would help improve bilateral trade. As much as it is criticized, it's necessary to note the positive impacts of the customs union for the Turkish economy, particularly since the 2000s. It has been a large contributor to the reinforcement of Turkish industry, which is today capable of competing in global markets, while an open economy principle has served as a successful economic growth model.