FTA Agreement With Turkey Will Allow Ukrainian Metallurgists To Supply Up To 430,000 Tons Of Finished Products Without Duties – Ukrmetalurhprom

President of the Ukrmetalurhprom smelters association Oleksandr Kalenkov believes that the agreement on a free trade area (FTA) with Turkey will allow Ukrainian metallurgists to supply up to 430,000 tons of finished products without duties.

He has written this on Facebook, Ukrainian News Agency reports.

"Turkey is opening up its metal products market for Ukrainian producers. A quota will be introduced for some of the commodity items - as a result, we will be able to supply up to 430,000 tons of finished products without duties. And this is already good, since the huge - six times larger than Ukrainian - the market was actually closed for us by duties of up to 26%. For more than 100 items, duties will be reduced, although slightly, this is expected to increase our competitiveness in the Turkish market since duties for Ukraine will be lower than for Russia. This is not yet a breakthrough, we still hoped for the complete abolition of duties, because there are no discriminatory restrictions on Turkish metal from Ukraine. But this is a step in the right direction," Kalenkov wrote.

According to him, Ukrainian producers supply Turkey with about 16% of all exports.

“So far, we are supplying semi-finished products in the processing mode, and the Turks export the rolled metal produced from it further, thereby keeping the added value for themselves. We can continue to protect our market by setting export duties on scrap, without looking back at the FTA," Kalenkov wrote.

According to him, metallurgists had serious concerns about the content of the FTA agreement with Turkey, however, the draft agreement presented by the Ministry of Economy took into account many proposals of domestic metallurgists.

"The first cautious announcements of the imminent signing of the FTA were made last fall, but since the text of the agreement was kept secret for a long time, the metallurgists had serious concerns about its content - would the interests of Ukrainian business be surrendered in favor of Turkish business? The fog was cleared only two days before signing the document on February 1, at a meeting at the Ministry of Economy with the participation of representatives of all interested industries. We were not handed over to the Turks!" he wrote.

As Ukrainian News Agency earlier reported, on February 3, Ukraine and Turkey signed an agreement on a free trade zone.

The agreement was signed on Thursday, February 3, after a joint press conference by President Volodymyr Zelenskyy and President of Turkey Recep Tayyip Erdogan.
According to the Ministry of Economy, the key position of the agreement is the establishment by Turkey of 0% duties on 10,337 commodity items, which is 95% of the total number of goods exported by Ukraine.

Besides, another 1,348 items will be subject to tariff quotas or reduced duties.

Thanks to the establishment of a 0% duty on the supply of grain by Turkey, Ukraine will receive improved conditions for access to the Turkish market for processed agricultural products.

The agreement also provides for the complete abolition of Turkish duties on industrial products.

To ensure the development of domestic metallurgy, Ukraine reserved the right to apply an export duty on the export of scrap metal, while Turkey opens the domestic market for Ukrainian metal, for 510 out of 840 metallurgical goods a zero duty is set.

For another 130 metallurgical goods, a partial reduction in duties was established.

Also, quotas of at least 411,000 tons are provided for 167 metallurgy products.

Besides, Ukraine maintains duties on used cars and second-hand goods and establishes three- and five-year transitional periods of duties on vehicles and light industry products.

Also, the goods produced from Turkish raw materials after the activation of the agreement will be considered Ukrainian and will be able to enter the markets of all European countries duty-free, according to the EUR1 certificate.

The Ministry of Economy notes that the agreement will have an overall positive effect on the Ukrainian economy, new jobs will be created in industries that will work for export, added value will be generated, and taxes will be paid.

According to preliminary forecasts, the agreement will annually give +2.2% to GDP and +2.6% to household income.

President Volodymyr Zelenskyy and Turkish President Recep Tayyip Erdogan met on Thursday.

Earlier, the Cabinet of Ministers approved a draft agreement on a free trade zone with Turkey.

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