The free trade agreement (FTA) recently inked between Turkey and the U.K. creates important opportunities for bilateral relations, according to officials.
Looking at the new markets in the Middle East after Brexit, relations with Turkey will be of great importance for the U.K., the co-chair of the All Parliamentary Group for Turkey, Lord Mark McInnes, told a virtual press conference Thursday.
"The fact that we were able to make a super FTA with Turkey at the beginning of the process shows the importance of Turkey-U.K. relations," McInnes said.
The event was organized by the Turkish British Chamber of Commerce and Industry (TBCCI) to discuss the bilateral ties and opportunities the FTA would offer to the two countries.
Turkey and the U.K. in late December signed the FTA to support a trade partnership worth over $25 billion (TL 174 billion).
The deal became effective as of Jan. 1, when Britain formally left the European Union, ensuring a quick transition after the previous deal ended at year-end.
The landmark deal is Turkey’s most important trade deal since its 1995 customs union with the EU.
More comprehensive deal
The officials have said the pact lays the groundwork for a new and more ambitious agreement in the days to come. It is expected to be expanded to include areas such as investments and services.
"There will be an opportunity in the next two years to work towards a much more comprehensive trade agreement between the U.K. and Turkey for even deeper trade relations," McInnes said.
"We need to do a lot of work over the next two years to ensure that we can fully benefit from a much more comprehensive agreement."
The fact that Turkey’s population is projected to reach 87 million in the next five years makes the country an even greater market for the U.K., he noted, stressing that they want to do as much business as possible with the country.
"There are things we can all work on to improve the relations and for a more comprehensive trade deal over the next few years," McInnes said.
While the U.K. was embedded in the EU trade bloc, Turkey has been finding new markets around the world and has brought along a "Turkish approach" to the global trade, he stressed.
"I think this is a very good example for the U.K. to think and learn something."
In his speech, Turkey’s Ambassador to London Ümit Yalçın stressed the FTA is of great importance for Turkey as it is the second most important economic and commercial agreement after the customs union.
Both McInnes and Yalçın stressed the continuity was the most important factor regarding the deal.
"First of all, the first importance of the agreement is to ensure the continuity of our bilateral trade, business and investment. Because the driving forces for the Turkish-British relations are cooperation in the fields of economy, trade, tourism, defense industry and security," the ambassador noted.
"For strategic and historical reasons, our cooperation in the security and defense industry is very critical," he added.
New identifier
For her part, TBCCI Chairperson Alderman Emma Edhem emphasized the fact that Turkey was among the first countries with whom the U.K. signed an FTA as soon as it left the bloc.
Edhem stressed that the deal was a new identifier of bilateral economic relations between the two countries.
Also addressing the event, U.K. Ambassador to Ankara Dominick Chilcott said British companies "love to come to Turkey."
The U.K. has a successful investment record when it comes to Turkey. "The U.K. has for many years been among the top three or four countries investing in Turkey," Chilcott added.
The U.K.’s investments in Turkey are around $11.6 billion, Turkey’s Trade Minister Ruhsar Pekcan said during the signing of the FTA deal in December.
"Most of the companies we have in Turkey have been here for a long time and they are very profitable in their operations in the country. They have long-term investment experience and are successful," he said.
Major investment potential
Separately, the U.K. Prime Ministry’s trade envoy to Turkey, Lord Robin Janvrin, Friday said British investors see significant investment potential in Turkey due to its resilient economy, young and talented workforce, ease of doing business and geostrategic location.
"(In Turkey) I see significant investment opportunities in smart city technologies, urban mobility and digital health that improve citizens’ lives and reduce environmental impact," Janvrin told Anadolu Agency (AA).
The U.K. has over 11 billion pounds ($15 billion) worth of foreign direct investment in many sectors in Turkey, he noted.
"In their daily lives, Turkish consumers benefit from Vodafone’s telecommunications services, AstraZeneca and GlaxoSmithKline’s top-quality medical technologies, and energy companies such as BP and Shell that provide energy to economic activities," the official said.
Chilcott further stressed there was a "huge economic transformation at the door of Turkey" that will need many new things.
It is an advantageous situation and opportunity for the European Union as well as for the U.K, he added.
"Over the last few years, we have noticed that we have become very dependent on manufacturing in China. We need to diversify our supply sources. This means that countries like Turkey, which are much closer to us than China, have an opportunity to benefit from this strategic change," Chilcott noted.
He also stressed that Turkey’s studies on climate change should be made more visible by the international community.
"Thus, the companies will be more emboldened to invest in green technology and green industry in Turkey," the ambassador said.