CAIRO, 28 December 2005 — Egypt and Turkey were expected to sign a free trade agreement yesterday aimed at tripling the volume of annual trade between the two countries over three years to $3 billion.
Foreign trade ministers from the two countries will sign the deal that comes after nearly 10 years of marathon discussions in the presence of Egyptian President Hosni Mubarak and his Turkish counterpart Ahmet Necdet Sezer. “The agreement offers a number of Egyptian industrial products preferential status in Turkish markets,” Egyptian Foreign Trade Minister Rashid Mohammed Rashid, told reporters on the eve of the signing ceremony. It removes customs tariffs on certain Egyptian products entering Turkey and vice versa and lower tariffs on others.
Egyptian and Turkish officials predicted that this would increase the volume of bilateral trade, which currently hovers at around a billion dollars annually.
Cairo is optimistic the agreement will improve its access to Turkish markets, especially in the area of consumer and industrial exports such as cement, iron, medical equipment and ceramics.Turkish Foreign Trade Minister Kursad Tuzmen forecast that the deal would also help boost bilateral ties and considerably increase his country’s investments in Egypt, which stand at around $600 million. Tuzmen said the agreement will enable that to jump to an estimated $2 billion.
Last year, TAV, a unit of Turkey’s Akfen Holding AS, was awarded a $350-million contract to build a third terminal at Cairo airport. Plans are already underway to establish a Turkish bank in Egypt that will draw shareholders from the country’s public banks, Tuzmen said. Private Turkish banks will also open offices in Egypt,” he added. Turkish investors also have their eyes set on Egypt’s textile industry.
Under the free trade agreement, Turkey will open up its markets to Egyptian customs-free products immediately, while Egypt will lift trade barriers gradually over a 16-year period, Rashid explained. It also allows Egypt better access to markets of countries in the region with which Turkey has free trade agreements such as Israel, Jordan, Syria, Tunisia and Morocco, as well as European markets.