Sat, May 18, 2019 - Page 10 News List

US ends preferential trade agreement with Turkey

Reuters, WASHINGTON

A US dollar is pictured on top of 50 and 100 Turkish lira banknotes in Istanbul on Aug. 14 last year.

Photo: Reuters

The US on Thursday terminated Turkey’s preferential trade treatment that allowed some exports to enter the country duty free, but it has halved its tariffs on imports of Turkish steel to 25 percent.

The White House said it was appropriate to terminate Turkey’s eligibility to participate in the Generalized System of Preferences (GSP) program based on its level of economic development.

The decision is effective from yesterday, it added.

The US Trade Representative (USTR) in early March said that Turkey was no longer eligible to participate, because it “is sufficiently economically developed.”

It in August last year began reviewing the NATO ally’s status in the program when the two nations were embroiled in a diplomatic row.

However, Ankara had been hopeful that Washington would not go ahead with the decision, saying it would be against the US$75 billion target for mutual trade laid out by US President Donald Trump and Turkish President Tayyip Erdogan.

During last year’s spat, Trump had imposed higher tariffs on imports of Turkish steel and aluminum to put economic pressure on Turkey to force it to release Andrew Brunson, a US pastor who was detained there over terrorism charges.

Brunson was released in October last year.

Trump’s move had sent the Turkish lira into a tailspin.

Since then, the ties between the two nations have remained tense over disagreements ranging from Ankara’s planned purchase of a Russian missile system to diverging interests in Syria.

In a statement on Thursday, the White House said it was reducing the 50 percent tariff, doubled in August last year, to 25 percent.

“Maintaining the existing 25 percent tariff on most countries is necessary and appropriate at this time to address the threatened impairment of the national security,” it said.

Turkey was one of 120 nations that participate in the GSP, the oldest and largest US trade preference program. It aims to promote economic development in beneficiary countries and territories by eliminating duties on thousands of products.

The US in 2017 imported US$1.66 billion from Turkey under the program, representing 17.7 percent of total US imports from Turkey, according to USTR’s Web site.

The leading GSP import categories were vehicles and vehicle parts, jewelry and precious metals, and stone articles, the Web site said.

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