- Kemi Badenoch visits Turkey to strengthen business links ahead of the expected launch of trade deal talks later this year
- Trip kicks off a big year of trade focused on progressing a wave of services-focused deals with countries like Turkey, Switzerland and South Korea, and the Gulf region in 2024
- Visit follows news Airbus will supply 220 planes to Turkish Airlines – one of the UK’s biggest ever export deals, worth billions of pounds and supporting thousands of jobs
Ahead of the launch of talks on an upgraded trade deal with Turkey, Trade Secretary Kemi Badenoch visits Istanbul to strengthen trade ties and kick off a year of boosting services trade.
The UK and Turkey have a thriving trading relationship, with trade up more than 17% in current prices to £26.2 billion in the year to June 2023. The two countries have an existing trade deal which covers goods but not services, digital or data – three key components of 21st century trade.
While in Istanbul the Secretary of State will meet her Turkish counterpart, Minister for Trade Ömer Bolat, to discuss how to boost UK-Turkish trade ahead of the launch of talks on an upgraded trade deal covering services and digital later in the year.
While there she will also visit Turkish Airlines, who have just contracted Airbus to supply them with 220 planes, the wings for which will be designed in Bristol and built in North Wales, with Rolls Royce supplying engines, made in Derby, for much of the fleet. The contract is one of the UK’s biggest export deals to date, worth billions of pounds to the economy and supporting thousands of skilled jobs.
Business and Trade Secretary Kemi Badenoch said:
I’m delighted to be in Turkey ahead of talks to upgrade our existing trade deal to make it fit for the 21st century.
The UK is the second biggest exporter of services in the world – UK lawyers, accountants and architects are in high demand across the globe.
With its major economy and strategic position, Turkey presents huge opportunities for UK businesses. And I’m excited to start discussions on ensuring our new trading relationship with Turkey unlocks those opportunities.
The UK’s services sector – from lawyers and accountants to engineers and financial professionals, makes up around 80% of GDP. Our services exports reached a record a high of £464 billion in the 12 months to October 2023, up 16% in current prices on the previous 12 months.
The UK has set its sights on progressing a whole host of innovative, service-focused trade deals with countries including Turkey, Switzerland, Mexico, Canada, India and South Korea, as well as the Gulf Cooperation Council, in 2024. The deals are designed to give UK companies a competitive edge in those countries, boost UK service exports even further and support jobs up and down the UK.
While in Istanbul the Secretary of State will also meet top UK and Turkish investors including Ford and Mott MacDonald to discuss how the UK and Turkey can boost investment in sectors such as manufacturing, tech and transport, building on the £8.9 billion of UK investments in Turkey and £720 million of Turkish investments in the UK.
TheCityUK Managing Director of International Nicola Watkinson said:
Turkey holds tremendous growth potential through the rising Middle East to Asia growth corridor. The UK is well-positioned to forge innovative and forward-looking trade agreements and be part of these exciting opportunities.
This visit not only demonstrates the UK’s commitment to fostering stronger economic relationships but also sets the stage for an ambitious Free Trade Agreement that promises benefits for our industry.
Mott MacDonald Group Head of Strategy Simon Harrison said:
Turkey continues to play a key geostrategic role in the world and shares the UK’s position of being a large economy adjacent to the European Union, and hence a partner with whom trade ties matter.
The UK-Turkey relationship is warm and longstanding, with many complementarities – for example UK professional services and Turkish construction are both world renowned, and these trade discussions provide an opportunity to build from a position of strength for both nations.
Background
- Trade between the UK and Turkey reached £26.2 billion in the 12 months to June 2023, making Turkey the 17th largest trading partner for the UK.
- UK services exports to Turkey in sectors such as transport, financial and other business services increased by 57% in current prices in the 12 months to June 2023.
- While in Istanbul the Secretary of State will also:
- Launch a £1 billion loan guarantee from UK Export Finance for the construction of a new 140km high-speed railway in Turkey, which is expected to create new, multimillion-pound contract opportunities for the UK’s manufacturing sector,
- Sign an MoU on third-country collaboration which could mean more opportunities for UK companies to support joint UK-Turkey projects such as the recent deal to develop 350km of drainage infrastructure in Iraq, to which UKEF will contribute £226 million,
- Announce Turkey as a priority country under the UK’s International Science Partnership Fund (ISPF) – opening the way for the best of the UK and Turkey’s scientists and innovators to partner together and bid into a £337 million global fund, and
- Conclude the review and update of the Technical Barriers to Trade chapter of the existing UK-Turkey goods-only FTA, which will help to facilitate goods trade, for example for motor vehicles and chemicals, between the UK and Turkey by helping to reduce or eliminate regulatory barriers.
- UKEF is an export credit agency operating at no net cost to the UK taxpayer. For their most recent announcement, please see the gov.uk release: https://www.gov.uk/government/news/mufg-and-export-credit-agencies-unlock-12bn-financing-for-turkish-electric-railway
