Trade with the United States has achieved momentum that has helped Türkiye’s shipments to the world’s largest economy reach an all-time high, making it its second-biggest export market this year, according to official data.
The pace comes despite diplomatic ups and downs that have frayed the decades-old partnership between the two NATO allies over recent years. Yet, intensified talks between the two countries leaders and diplomats so far this year, the launch of a strategic mechanism and Ankara’s efforts in the Ukraine war seem to have contributed to warming the relations.
Despite rifts, bilateral trade flow maintained a steady course over the recent years, before booming this year, while businesspeople say they expect the U.S. to become Türkiye’s most important export market in the near future.
Sales of Turkish goods to the U.S. rose to nearly $13.2 billion from January through November this year, an increase of almost 15% versus a year ago, according to data from the Turkish Exporters Assembly (TIM).
The figure means some 5.71% of all outbound shipments in the 11-month period went to the U.S. and made it Türkiye’s second biggest export market after Germany, which received some $17.34 billion worth of Turkish goods so far this year.
The U.K. and Italy followed with $11.25 and $9.53 billion, respectively, according to the data, also reiterating Europe’s high rank in Türkiye’s trade.
High ambitions despite tensions
Shipments are expected to approach $15 billion and bilateral trade volume is seen reaching up to $28 billion as of the end of the year, says Turkish-American Business Association – American Chamber of Commerce (TABA AmCham) head Süleyman Sanlı.
The U.S. reached a level where it is the second most important country in Türkiye’s export market, Sanlı said. "It previously ranked fourth, now it has jumped to second place. We expect it to rise to the leadership in a short time," he told Anadolu Agency (AA).
Ankara and Washington have set an ambitious goal of quadrupling their trade to $100 billion a year, a target endorsed by President Recep Tayyip Erdoğan and his American counterpart, Joe Biden, despite tensions and disagreements on various matters.
Ties between Ankara and Washington have been strained over such issues as Türkiye's acquisition of S-400 missile defense systems from Russia and policy differences in Syria, Libya and the Eastern Mediterranean.
The U.S. sanctioned the Turkish defense industry in December 2020 over the S-400s and expelled its NATO ally from its F-35 fighter jet program. Ankara has called the moves unjust, but the allies have since been working to set aside differences and focus on cooperation, including on Ukraine.
Recent positive developments regarding Türkiye's request to purchase dozens of F-16 fighter jets from the U.S. are expected to efforts to improve ties.
Türkiye has been seeking to modernize its existing warplanes to update its air force and sought to buy 40 Lockheed Martin F-16 jets and nearly 80 modernization kits from the U.S. after the purchase of F-35s fell through.
Biden has said he supports the sale and that he would work to convince lawmakers to deliver the F-16 jets for Türkiye’s air force.
Tariffs dispute
Meanwhile, with an almost $1.7 billion increase, the U.S. ranked second among markets where Türkiye’s exports rose on a value basis the most from January through November. Russia ranked first with a $1.95 billion increase.
Chemicals industry exports to the U.S. topped the list among sectors with around $1.44 billion worth of sales, the TIM data showed. It was followed by automotive with $1.33 billion, steel with $1.17 billion, jewelry with $936.86 million, and ready-to-wear with $929.45 million.
Additional customs duties on certain steel and aluminum products imposed during the term of former President Donald Trump in 2018 hindered $1.5 billion worth of export volume, Sanlı said.
The U.S. imposed 25% and 10% import tariffs on certain steel and aluminum products, respectively, based on what Washington said were national security grounds.
Türkiye, along with several other nations including China, Norway and Switzerland, had approached the World Trade Organization to object to the U.S. move. A WTO dispute panel last week ruled that the U.S. was inconsistent with global trade norms.
"However, the U.S. authorities announced that they would not recognize this decision," said Sanlı.
He also reported that Türkiye had additional customs duties on various U.S. products, including SUV cars, luxury jeeps, motorcycles and tobacco.
Exports may reach $25B
"There are mutual negotiations between the ministries of commerce of Türkiye and the United States for the mutual abolition of these duties," Sanlı said.
"If the customs duties imposed on Turkish steel and aluminum are abolished, we would immediately reach the level of $20 billion. In fact, we predict that our exports will reach $25 billion in 2023."
Sanlı said there are important opportunities in the U.S. market that should be evaluated, particularly when it comes to the furniture industry.
"There are very serious opportunities before the furniture industry. There have also been important entries from our members to the U.S. market in this sector. It is very valuable for our companies to enter the market with their own names," he noted.
Sanlı also cited important investments in logistics and e-commerce. "There are important opportunities in leather, cosmetics, technical textiles, medical and health tourism in the U.S.," he said.