Following German Chancellor Angela Merkel's remarks on Wednesday stating that the customs union deal with Turkey is not going to be modernized, EU Affairs Minister Ömer Çelik criticized the German chancellor and called her statements unfortunate. Following Turkey's reprimand, Economy Minister Nihat Zeybekci said Turkey is still considering its affiliation with the European Customs Union but aspires to become a part of Eurasian Customs Union, as well.
Striving to expand its collaboration across the globe, like the recent sectorial partnership with the Association of Southeast Asian Nations (ASEAN), Turkey has devised an economic partnership agenda that could tie the country to the various regions of the world. To that end, one of Turkey's largest trade partners, Eurasia emerges as a favorable partner with whom to deepen commercial relations.
Speaking at the 85th Izmir International Fair (IFF), recognized as one of the oldest fairs in the world, Zeybekci said Turkey has not been removed from the customs deal with Europe, which took effect in 1996, but highlighted the country's goal to be involved in the Eurasian Customs Union.
Zeybekci said that work on the Joint Investment Fund with Russia continues and that the fund will start operating this year. Moreover, he said that talks on a free trade agreement that covers services and investments between Turkey and Russia will be finalized this year or during the first half of 2018.
Commenting on Merkel's remarks, Zeybekci contended that the German chancellor is not authorized to make such statements. Emphasizing that Merkel cannot make decisions by herself on updating the customs deal, the minister pointed to EU officials' opinions indicating that modernization is lucrative both for Turkey and the EU.
Pointing out that the 28-member European Council has the authority to unanimously decide on reforming this deal, the economy minister said that update talks continue, expressing his belief that Merkel's remarks do not reflect Germany's considerations on the deal.
The Eurasian Customs Union (EACU) is a customs union that consists of all member states of the Eurasian Economic Union, Russia, Kazakhstan, Belarus, Armenia, and Kyrgyzstan. No customs are levied on goods travelling in the customs union.
When exporting goods, a zero-rated value added tax (VAT) is guaranteed and excise duties are exempted if sufficient documentary evidence for exports is provided. Goods imported into Russia from Belarus or Kazakhstan are subject to VAT and excise duties and are levied by Russian tax authorities.
Some 87.95 percent of customs import duties are reported from Russia's budget, 4.7 percent from Belarus and 7.33 percent from Kazakhstan.
Russian minister: Energy cooperation is foundation of Turkish, Russian partnership
Speaking at the Turkish-Russian Business Forum - with16 ministerial level guests from 26 countries in attendance within the scope of the İzmir International Fair - Russian Energy Minister Alexandre Novak said that energy partnership is the foundation of Turkish-Russian cooperation: "There are very good examples and symbols in this regard. The position of Russia and Turkey in the world economy is getting stronger."
Novak said that Russia pays particular attention to investments in construction, infrastructure and healthcare, stressing that it is of great importance that Turkey's gas needs are met by Russia. Indicating that the TurkStream Natural Gas Pipeline Project is progressing very successfully, while the Akkuyu Nuclear Power Plant, another project serving as a lantern with an investment of $22 billion, utilizes the build-operate-transfer system and should be completed on the 100th anniversary of the Republic of Turkey. Novak said cooperation between Turkey and Russia is multidimensional, adding that there are also ongoing projects in agriculture, construction and tourism sectors.
"I am confident that all of this will contribute greatly to cooperation between Russia and Turkey. Throughout our collaboration, both the Russian and Turkish sides have passed through difficult times," Novak added. "We can say that they have overcome those difficulties. It is a great opportunity for Russia to become a partner country in the IEF."
Citing President Recep Tayyip Erdoğan's visit to Moscow on March 10, Novak said that the trade volume between the two countries was targeted at $100 billion.
Novak indicated that a very serious legal ground has been established in relations between Turkey and Russia and that they have also started to work on scientific and cultural collaborations.
Explaining that they are working on an intergovernmental agreement on service and investment, Novak said that they intend to complete the preparatory period in this regard by the end of the year.
He also pointed out that they agreed to hold a joint economy meeting in Tatarstan's capital of Kazan with Zeybekci on Oct. 22, and that they continue talks on trade, investment, industry and interregional cooperation.
Novak stressed that they placed great importance on investment during bilateral talks. "We see that Russian companies invest over $10 billion in Turkey. The investments of Turkish partners in the Russian Federation are more or less the same amount," he said.
Highlighting that bilateral commercial economic cooperation has also developed between Turkey and Russia, Novak said trade volume, for example, increased by 28 percent in the first half of this year, adding that the main fields of bilateral cooperation have also been improved.
Expressing gratitude for being granted the status of "partner country" in the IEF, Novak said they have come here with a delegation of more than 300 members at the request of President Putin.