The Free Trade Agreement (FTA) between Ukraine and Turkey, which has been worked on for years, seems to be nearing finalization. Recently, Ukraine’s Cabinet of Ministers approved the draft conditions and the countries are expected to sign the document on February 3, during the meeting of the presidents of the two countries in Kiev.
According to sources, one of the most notable points in the FTA is Turkey setting zero percent duties for 10,337 products, which is 95 percent of all goods, exported by Ukraine. In addition, another 1,348 product groups will be subject to reduced duty rates or quotas. The main target is to increase the trade turnover between the countries to $10 billion per year.
The steel market players of both countries are naturally interested in how the FTA would affect the trade between the countries, since the dispute on metals had been one of the main obstacles for the sides to sign the agreement over the years. Although the full details have not yet been disclosed, Ukraine’s economy ministry has already announced that there will be incentives for metallurgical products. “Turkey is opening the local market for our metal. 510 out of 840 product groups will be subject to a zero percent duty. Another 130 products will be subject to a decreased duty rate which gives us the advantage over Russian origin material. For 167 of metallurgical products, there will be quotas of no less than 411,000 mt,” the ministry’s statement reads. In terms of carbon steel, Ukraine is one of the key suppliers of slabs, billets and various flats to the Turkish market.
Still, the clear details of the agreement are expected to be disclosed to the wider public in the near term. In the meantime, according to media sources, Ukraine gets to keep the currently valid €180/mt export duty for ferrous scrap.