With the Ukrainian parliament’s ratification of the free trade agreement with Turkey on July 14, a deal nearly two decades in the making is now poised to enter into force.
Negotiated since 2007, the agreement—which was signed during President Recep Tayyip Erdoğan’s February 2022 visit to Kyiv—has generated both enthusiasm and resistance within the two countries’ business communities. The central challenge was balancing Ukraine’s interest in gaining access to Turkey’s heavily protected agricultural market with Turkey’s push to export more industrial goods to Ukraine. Producers in sensitive sectors on both sides feared heightened competition.
Under the agreement now set to enter into force, liberalization will be substantial but deliberately phased to give sensitive domestic sectors time to adjust. Turkey will immediately eliminate tariffs on 93.4 percent of Ukrainian industrial goods and 7.6 percent of agricultural products. Tariffs on an additional 1.5 percent and 28.5 percent, respectively, will be removed over the next three to seven years. Meanwhile, Ukraine will initially lift tariffs on 56 percent of Turkish industrial goods and 11.5 percent of agricultural products, before phasing out tariffs on an additional 43.2 percent and 53.7 percent over transition periods of up to five years for industry and ten years for agriculture.
