Note: Advance written questions by WTO Members and replies provided by the Government of  
 Turkey are reproduced in document WT/ TPR/M/125/Add.1 and will be available online 
 at:  http://www.wto.org/english/tratop_e/tpr_e/tp_rep_e.htm.  WORLD TRADE  
ORGANIZATION  WT/TPR/M/125 
9 February 2004 
 (04-0496) 
Trade Policy Review Body 
17 and 19 December 2003 Original:  English 
 
 
 
TRADE POLICY REVIEW 
 
TURKEY 
 
Minutes of Meeting  
 
Chairperson:  H.E. Mrs. Mary Whelan (Ireland) 
 
 
   P a g e  
I. INTRODUCTORY REMARKS BY THE CHAIRPERSON 3 
II. OPENING STATEMENT BY THE REPRESENTATIVE OF TURKEY 4 III. STATEMENT BY THE DISCUSSANT 6 
IV. STATEMENTS BY MEMBERS OF THE TRADE POLICY REVIEW BODY 10 
V. REPLIES FROM THE REPRESENTATIVE OF TURKEY AND ADDITIONAL 
COMMENTS  15 
VI. CONCLUDING REMARKS BY THE CHAIRPERSON 19 
 
  WT/TPR/M/125 
 Page 3 
 
 
I. INTRODUCTORY REMARKS BY THE CHAIRPERSON 
1. The third Trade Policy Review of Turkey was held on 17 and 19 December 2003.  The 
Chairperson welcomed the delegation from Turkey  led by Mrs. Ülker Güzel, Deputy Undersecretary 
of Foreign Trade, and the discussant, H.E. Dr. Péte r Balás (Hungary).  As usual, the discussant would 
speak in his personal capacity and, in accordance wi th the established procedures, had circulated in 
advance an outline of the main issues he intended to raise (document WT/TPR/D/103). 
2. The Chairperson recalled the purpose of the Tr ade Policy Reviews and the main procedures 
of the meeting.  The report by the Government of  Turkey was contained in document WT/TPR/G/125 
and that of the WTO Secretariat in document WT/ TPR/S/125.  The delegations of Switzerland; Japan; 
Canada; Australia; Hong Kong, China; the United States; the European Union; Colombia; Chile; 
Chinese Taipei; India; Norway; Indonesia; and Brazi l had submitted written questions in advance, and 
these had been transmitted to the Turkish delegation.   These questions, and the replies provided by the 
delegation of Turkey are reproduced in WT/TPR/M/125/Add.1. 
3. The Chairperson noted the important stabilizati on efforts made by Turkey since its previous 
Review in 1998.  However, its economic situation remained fragile , with high inflation and public 
indebtedness, and economic growth alternating with  recession.  Increasingly, Turkey’s trade policies 
were being pursued through a wide network of bilate ral and regional trade agreements, with a view to 
bringing its trade regime into line with its cust oms union on industrial products with the EU, to which 
its accession remained its ultimate objective.  Excl usion of agriculture from the agreements and the 
high tariff protection of the sector made it difficult for agricultural products to be exported or used as 
inputs in production of export goods without suppor t.  The continuation of the reforms and further 
multilateral trade liberalization would be important for Turkey's ambitious reforms to show full and 
sustained effects. WT/TPR/M/125 
Page 4  
 
II. OPENING STATEMENT BY THE RE PRESENTATIVE OF TURKEY 
4. The representative of Turkey
 thanked the Chairperson, and stressed that the Trade Policy 
Review Mechanism was one of the outstanding achievements of the Uruguay Round. 
5. Since its last TPR in 1998, Turkey had e xperienced an important structural economic 
transformation, implementing four economic stabili zation programmes.  The reform initiatives that 
began in 1980 had turned the Turkish economy from a protected and state-directed system into a free 
market system.  Turkey's real GNP growth rate averaged 4% in the 1981-02 period, and averaged 
6.4% excluding the two financial crises in 1994 and 2001, and the 1999 earthquake.  Turkish 
openness (i.e. the share of total trade volume in  GNP) increased from 30.6% in 1994 to 48.3% in 
2002. 
6. Some of the key elements of the 2001 refo rm programme were:  a macro-framework to 
restore financial stability and ensure sustainability of  public debt;  a rapid restructuring of the banking 
sector;  structural reforms in the public sector to improve public expenditure management and 
governance;  a renewed privatization process;  and st rengthening of social assistance to help low 
income groups affected by the crisis.  
7. The restructuring of the Turkish economy had b een determined largely by the international 
economic environment and rules, and the Turkey-E U integration process.  Economic recovery had 
been recorded in 2002 and continued in 2003 as a positive effect of the 2001 programme.  The 
programme was also aimed at reducing the inflation rate;  the target of 20% by 2003 was reached as 
inflation stood at 19.3% at the end of November 2003.  The 2004 inflation target was 12%. 
8. A new Foreign Direct Investment (FDI) Law w as issued in June 2003 to increase FDI inflows 
as Turkey's share in global FDI flows was insignificant.  FDI was a top priority and an integral part of 
the Turkish economic policy.  In addition, since 1998, several autonomous bodies had been 
established to regulate free market operations in sectors being opened to competition, such as energy, telecommunication, sugar, tobacco, and alcoho lic beverages.  An Agricultural Reform 
Implementation Project (ARIP) 2001-05 had been launched;  it was aimed at phasing out price 
support and input subsidies, and introducing a decoupled support system. 
9. The services sector contributed two-thirds of GNP .  In some services subsectors, independent 
regulators had been appointed, and the liberalizatio n and privatization process had been extended.  
Turkey was engaged in trade in services negotiati ons and had submitted its in itial conditional services 
offer to the WTO. 
10. Turkey had taken steps to strengthen the im plementation of its commitments under the WTO 
TRIPS Agreement.  A new law had been enacted:  th e penal provisions had been revised, and author's 
rights and some related rights had been amended.  Two specialized courts (in Istanbul) had been set 
up to enforce intellectual property rights;  another seven courts would be set up in other cities.  
11. Despite the 2001 financial crisis, merchandise trade exports amounted to over US$30 billion 
in 2001 thanks to the devaluation of the Turkish lira (TL) and the Turkish competitive advantage in 
the manufacturing sector.  This increasing trend in goods exports continued in 2002 and was expected 
to reach more than US$46 million in 2003.  Annua l export growth was over 20% in 2003, despite the 
global economic and commercial stagnancy of the last  three years.  Export products were dominated 
by traditional sectors (textiles and clothing, iron, and steel) but some high-value-added sectors 
(durable goods, and automotive products) had increased  their shares in total exports and had improved 
their competitiveness in the world market.  Impor ts had increased 11.3% on average, annually, over 
the past ten years;  rose by 25%, to US$52 billion in 2002, and by 35% to US$49 billion during the  WT/TPR/M/125 
 Page 5 
 
 
first 9 months of 2003. During the last decade th e breakdown of imports had been 60% intermediate 
goods, 30% capital goods, and 10% consumption goods.  Turkey believed that imports were an 
essential component of its development strategy.  
12. Turkey's average customs duty rate for ma nufacturing products had fallen to 4.4% by 
January 2003, placing Turkey among the most open developing countries concerning tariff rates on 
manufactured products.  It had impl emented its GSP scheme since early 2002, and by 2004, the least 
developed countries would benefit from fr ee access for all industrial products. 
13. A trade volume of US$115 billion was expected at the end of 2003.  The representative 
believed that Turkey would be a model for developm ent with a long-term policy of liberal trade both 
multilaterally and regionally.  Moreover, as the sma ller partner of the customs union with the EU, 
Turkey was a good example of the benefits from the dynamic effects of economic integration and 
recomposition of the structure of production and the trade portfolio.  Turkey's trade policies were 
determined by its membership to the WTO, its customs union with the EU, and its 15 free-trade 
agreements (FTAs).  
14. Turkey considered regionalism as a natural process and as a complementary means to 
multilateral liberalization.  For Turkey, which bri dged different regions with economic, political and 
cultural variations, regional integration was a very im portant tool to bring stability and prosperity to a 
very extensive area.  In parallel with its exis ting FTAs, Turkey had launched a Trade Development 
Strategy with Neighbouring and Region Countries, in 2000.  Turkey matched its trade policy to 
contribute to economic and political stability in its region.  The various economic organizations in the 
area (i.e. Black Sea Economic Cooperation Organiza tion, Economic Coopera tion Organization, and 
Organization of Islamic Countries) had emerged as new fora to initiate better regional trade 
conditions.  Despite its involvement  in regional trade arrangements, Turkey was truly committed to 
the primacy of the multilateral trading system.  
15. The representative concluded that although the Doha objectives could not yet be achieved at 
the global scale, Turkey remained committed to th e rules and principles of the multilateral trading 
system, and would work eagerly to push forw ard liberalization in the multilateral arena. WT/TPR/M/125 
Page 6  
 
III. STATEMENT BY THE DISCUSSANT 
16. The discussant's statement covered three broad headings, starting with economic 
developments.  Turkey's economic growth and devel opment had been affected by political events in 
its region.  Even putting the political events aside, Turkey’s recent economic history was characterized by abrupt changes: since 1998, an nual GDP growth alternated between positive and 
negative rates. These sudden swings clearly showed  the high level of instability of the Turkish 
economy. The stop-go cycles, coupled with an unstable political set-up in the Parliament until late 2001 had prompted not less than four stabilization programmes since 1998.  
17. The fourth programme, launched in 2002 and to run until 2004 had a better chance of success 
than its predecessors. The present Government enjoye d a comfortable parliamentary majority, thus the 
necessary legislative changes could be enacted more easily. The programme was drawn up in 
coordination with and was supported by the international financia l institutions. The first results were 
promising, as the economy had shown 7.8% growth  in 2002 and the positive tr ends had continued in 
the first half of 2003. The full success of the stab ilization programme depended on dealing with the 
underlying structural weaknesses of the economy. A long-standing problem was the persistently high 
level of inflation. This rate had recently dropped to about 20%, and 12% was expected for 2004. The 
Government had the difficult task of tackling th e underlying causes and to ensure, among others, a 
consistent reduction of the high leve ls of public sector debt in the co ming years.  The discussant asked 
what, specifically, was foreseen by the Government to reduce further the levels of public debt and 
inflation;  how volatility of the Turkish lira was to be reduced with a floating exchange rate;  whether 
the Government expected an appreciation of the Turkish currency, which could exert a downward 
pressure on domestic prices, and if so, ho w it would affect export competiveness. 
18. The discussant said that continued structural ad justment was another important issue for the 
Turkish economy. In recent decades th e share of agriculture in GDP had fallen consistently, reaching 
a level of 11.7% in 2002. Still, this sector continued to employ over one third of the work force. This 
in turn was partly because the job-creating perfo rmance of the manufacturing and service sectors was 
not sufficiently high.  The Turkish economy had hu ge potential in these areas: with abundant and 
cheap labour, with free access to mo st European markets, with ex cellent conditions for attracting 
tourists, both manufacturing exports and service industries, like tourism and transport could achieve outstanding growth. It was reassuring that exports  had continued to expand in 2002 and the trade 
deficit had also remained at managable levels . The discussant was convinced that the Turkish 
manufacturing and service industries should in crease their international competitiveness. 
19. To achieve the necessary structural changes in  its economy Turkey needed capital. With 
already high levels of indebtedness, borrowing more  was not a realistic option, instead the conditions 
for both domestic and foreign investors should be fu rther improved. This re quired both policy changes 
and improvements in administrative practices. Much had been done in recent years to transform the 
Turkish economy from a protected and state-directed  situation into a free-market system. Still, the 
role of the public sector was still quite important in many sectors. State enterprises were in monopoly 
position in a number of service sectors and were active also in certain key manufacturing industries.  
20. The discussant explained that it was extrem ely difficult to achieve international 
competitiveness in manufacturing through state-owne d companies because such enterprises often 
lacked sufficient profit orientation and tended to be over-staffed. The high price of electricity and gas 
were major handicaps for the Turkish manufacturers when competing with foreign suppliers.  The 
present plans for speeding up privatization were promis ing.  There was room to increase the role of 
foreign investors and the total capital inflows of some US$15 billion achieved so far were not really 
huge for an economy like Turkey’s.  In this cont ext, the discussant wanted to know about the 
Government's specific plans for privatization in the short term, especially in sectors where state 
companies were in a monopoly position;   and was in terested in hearing about the first experiences  WT/TPR/M/125 
 Page 7 
 
 
with the new FDI law, adopted in June, aimed at  lessening the administrative burdens for foreign 
investors. 
21. With regard to trade policies, the discussant stated that Turkish exports and imports had 
shown substantial volatilities in recent years. Me rchandise exports had star ted to expand since 2001 
and this trend had accelerated in the first half of 2003. The trade deficit had also fallen compared with 
the late 1990s but import growth had again exceeded th at of exports.  To offset these tendencies and 
to ensure a sustainable current account position it w ould be important to increase income receipts 
from services. A major part of such incomes was ma de up of tourism, which had grown gradually in 
recent years.  Still, overall receipts from the services sector had fallen steeply, showing a poorer performance in other subsectors.  The discussant was interested in knowi ng what was behind these 
trends and why incomes from service sectors othe r than tourism had fallen to such an extent. 
22. The two main features of Turkish trade policies were participation in the multilateral system 
and strengthening ties with the EU with the purpose of eventual accession. Turkey was also a party to 
an increasing number of regional and bilateral agreem ents, especially on the Eu ropean continent. The 
EU had been and remained the single most importa nt destination for Turkish exports and source for 
imports, its share in both respects seemed to ha ve remained unchanged since the late 1990s. More 
broadly, the share of Turkey’s trade with preferen tial partners did not seem to have increased either. 
This implied that the bilateral agreements might not  have had very strong trade-diverting effects and 
that MFN-sources remained important in imports. 
23. As well as the lightening of administrative obst acles for imports, tariffs on industrial products 
had been reduced to quite low levels.  Turkey, a middle-income country with less than US$3,000 
GDP per capita, had undertaken substantial autonom ous liberalization through its customs union with 
the EU. From 2001, the additional tariffs set above the CET levels for certain "sensitive" industrial 
products had been abolished. Thus , the protection enjoyed by the Turkish industry was now the same 
as that available for a group of the most develope d WTO Members. This fact was not changed even 
by the high share of unbound tariffs in Turkey’s ta riff structure.  In this respect the discussant asked 
about the significance of the unbound tariffs when Turk ey had taken on the EU’s external tariffs with 
respect to industrial products;  whether the present situ ation implied that Turkey could raise its tariffs 
again to levels higher than those used by the EU, a nd, if this was not the intention, whether Turkey 
was ready to undertake a full binding of its tariffs. 
24. A major part of Turkey's imports were subject to preferential tariffs. Most of these were low 
or even at zero level under Turkey’s bilateral preferential agreements.  However, Turkey also 
operated an autonomous preferential scheme favouring other developing countries. Under this scheme 
a number of products originating in LDCs could en ter duty-free, while products originating in other 
developing countries could enter at reduced rates,  in line with the EU’s GSP system. It was 
commendable that Turkey, a developing country itsel f, provided assistance in this way to other 
developing countries.  The discussant asked the Turkis h delegation to give so me details of its GSP 
system. 
25. Some levies other than tariffs remained in for ce with respect to the fisheries sector and the 
number of products subject to this measure had slightly increased. Other charges and taxes were 
applied in line with the national treatment princi ple. Turkey used anti-dumping measures relatively 
frequently but had not used countervailin g and safeguard measures so far.  
26. Despite not being a member of the WTO Gove rnment Procurement Agreement (GPA), there 
was an ongoing process to streamline Turkey's proc urement practices: two laws had been enacted 
recently to increase transparency and competition in  the procurement process. Domestic tenderers 
benefited from a transparent preference: when s upplying goods and services of domestic origin they 
enjoyed a 15% price preference.  The discussant ask ed whether the 15% price advantage was the only 
assistance for domestic suppliers or whether there were other forms of preference. WT/TPR/M/125 
Page 8  
 
27. The protection of intellectual property was appa rently becoming a more and more important 
issue not just to fulfil Turkey's obligations under th e TRIPS Agreement but also to prepare the country 
for accession to the EU. Since its last TPR, Turkey had introduced changes in its regulations, such as 
the extension of patent protection to pharma ceutical products, new laws on artistic work and 
strengthening the enforcement system. This la tter aspect was quite important, because in many 
emerging countries, like Turkey, the enforcement of  new regulations required significant resources. 
The number of both penal and civ il actions had grown quite dramatically recently.  The discussant 
wondered whether this implied a higher number of  unlawful practices or whether it was to be 
attributed exclusively to more stringent enforcement measures. 
28. With respect to sectoral issues, agriculture  was considered as an especially sensitive sector in 
Turkey.  In line with commitments under the Urugua y Round Agreement, Turkey now had only tariff-
based protection, and all its agricultural tariffs were  bound. Products of this sector were not covered 
by the customs union with the EU;  most tariffs were based on the national Turkish system.  There 
were only limited exception, i.e. processed food items , where combined tariffs were applied in line 
with the EU’s system;  a certain portion of the tariff related to commodities included in the final 
product while another portion related to industri al processing. Turkey had not undertaken major 
market access commitments even under its prefer ential agreements. Agricultural producers enjoyed 
certain domestic support measures. While previously the major tool s had been production enhancing 
or price support and subsidies for certain agricu ltural inputs, since 2001 a major overhaul of the 
support system had taken place. Under this progr amme, direct income support became the most 
important measure, representing about three-quarter s of all support. Turkey also applied export 
subsidies for a limited number of agricultural products.  
29. The discussant had been surprised  to read in the Secretariat document that Turkey was among 
the top ten food exporters of the world. This was no mean feat considering that Turkey's technological 
level in the agriculture was relatively low, much of the production came from small family farms.  
Considering these somewhat contradictory facts, th e discussant was interested in knowing what were 
Turkey's basic goals in the DDA negotiatons and whet her its participation in the talks was more from 
an offensive or a defensive stance. 
30. Agricultural products could be imported only on production of an import control certificate 
related to health and SPS requirements. The G overnment reported that it was continuing the 
harmonization of sanitary and phytosanitary regula tions with EU norms. Notwithstanding this fact, 
there were complaints from other WTO Members c oncerning the use of SPS measures in a way that 
seemed to be more stringent than the practice of developed countries.  The discussant asked whether 
Turkey’s SPS requirements were more stringent than  those of the EU, and when Turkey intended to 
achieve full harmonization of its SPS regulations with the EU norms. 
31. The manufacturing sector was growing at a fast rate and played an increasing role in Turkey's 
economy. Reflecting the comparative advantages of the country in a number of industrial sectors, 
manufactures already provided the bulk of Turk ish exports. Modernization of the economy and the 
creation of jobs all depended to a large extent on manufacturing. Turkey’s investment promotion 
policies were to a large extent also focussed on th is sector. There were free zones where companies 
could operate with much less restriction and admini strative burden.  A system of incentives was also 
used to promote investment activity in general, while special assistance was available to small and 
medium-scale companies. While there were no compulsory local-content requirements, some 
companies in the automotive sector had voluntary local-content undertakings.  The discussant asked 
the Turkish delegation for its evaluation of the effi ciency of the investment promotion measures used 
so far;  whether there were ideas to introduce ne w incentives, and if so, was there a monitoring and 
evaluation mechanism that examined such ideas to ensure their conformity with Turkey’s 
international commitments.  WT/TPR/M/125 
 Page 9 
 
 
32. The textiles and apparel  sector was one of Turkey’s largest  industries, and the pace of its 
development was outstanding. It was also an export -oriented industry providing more than one third 
of total merchandise exports. The cotton sector was especially strong, based on the large-scale local 
production of the basic material. As a kind of rec ognition of its competitiveness, Turkey was subject 
to quotas in certain categories in a few overseas mark ets. On the other hand, Turkey also applied some 
protective measures. When Turkey introduced impor t quotas for a number of textiles and clothing 
products, in line with the textile regime of the EU , under the customs union, this raised complaints 
from important textile exporters.  As Turkey w as a major producer and exporter of textiles and 
clothing and at the same time a market for other textile exporters, the discussant was interested in 
knowing about experience with the import quotas, a nd whether they played an important protective 
role for the Turkish industry.  He  also asked whether the quota qua ntities were, in general, largely 
used. 
33. The services sector  provided more than 64% of Turkish GDP. In some sectors, private 
providers played a substantial role. Other sectors were still characterized by the operation of state-
owned companies, often in a monopoly position. Tu rkey had taken various steps to improve the 
performance of the service industries. In some heav ily regulated sectors, like telecommunication and 
banking, independent regulators had been appointed . Steps had also been taken to speed up the 
liberalization and privatization process even in  sensitive sectors.  The discussant enquired about 
Turkey's specific plans to continue the libera lization and privatization of the service sectors, 
especially concerning telecommunication and financial services. 
34. Turkey was especially successful in the touris m sector even in a global context: tourism 
receipts had grown by some 50% in the last four years, and with US$11.9 billion receipts the country 
ranked 11th in the world. These positive result might have been to a large extent attributable to liberal 
policies and lack of excessive regulations. The in flow of capital, including from foreign sources was 
not limited. The Turkish Government also applie d well planned promotion measures and incentives to 
boost the tourism sector. Turkey had scheduled commitments under the GATS and also signed the 
basic telecommunication and financial services pr otocols.  The discussant asked the Turkish 
delegation to briefly summarize its objectives with respect the DDA services negotiations;  in which 
sectors Turkey had offensive interests;  and in wh ich areas it would be in Turkey's own interest to 
undertake further liberalisation commitments. WT/TPR/M/125 
Page 10  
 
IV. STATEMENTS BY MEMBERS OF THE TRADE POLICY REVIEW BODY 
35. Members welcomed the delegation of Turkey and thanked Mrs. Güzel and the discussant for 
their statements, and the Government of Turkey and the WTO Secretariat for their reports.  A number of Members referred to the questions they had subm itted in writing and looked  forward to receiving 
the replies of the Turkish delegation. 
36. The representative of Switzerland
 stated that Turkey was an important trading partner and the 
trend in bilateral trade between the two econom ies was a steady increase.  Switzerland welcomed 
Turkey’s firm commitment to liberal trade polic ies providing broad market access opportunities 
through opening up to foreign competition. She noted with satisfaction that the outlook for the Turkish economy remained positive, and encouraged Turkey to proceed with reforms as quickly as 
possible. Switzerland also welcomed the Turkis h commitment to further political and economic 
adjustments, developed in line with th e perspective of accession to the EU.  
37. Switzerland appreciated the Turkish efforts to improve the investment environment, in 
particular the new statute on Foreign Direct Invest ment of June 2003, and encouraged Turkey to 
further exhaust its vast potential for attracting inv estment, which remained untapped to a large extent. 
She highlighted two areas (protection of intellectua l property rights and tariff procedures) in which 
investment incentives did not work without a ge nerally enabling environment.  She noted the 
important efforts undertaken by Turkey to adjust its economic and trade policies in accordance with 
the WTO principles and rules. 
38. The representative of Japan
 noted that Turkey and Japan were close economic partners.  
Turkey was one of the most important recipients of Japanese aid in the Middle East.  Japan welcomed 
the Turkish economic recovery, and the steps Turk ey had taken to stabilize its economy, and to 
implement reforms.  Japan appreciated that the fr ee zones had attracted FDI, and welcomed Turkey's 
efforts to harmonize its standards and technical re quirements with those of other countries.  Japan 
hoped that Turkey would improve the regulations in the energy sector.   
39. The representative of Canada  stressed that bilateral trade between Turkey and Canada had 
been increasing in recent years.  The Turkish economy w as recovering;  it should be able to absorb the 
negative impact of the recent terrorist attacks.  Canada encouraged Turkey to continue its fiscal 
reforms, and to revitalize certain key sectors.  Tu rkey had recognized the importance of attracting and 
facilitating FDI.  Canada supported and encouraged Turkish efforts to  improve the climate for private 
investment.  Canada was pleased that MFN applied ra tes had declined in recent years, but more than 
half of Turkey's rates remained unbound.  Canada  urged Turkey to reduce the gap between often 
substantially higher bound rates and applied rates, and to increase its binding commitments.  Canada 
encouraged Turkey to continue its positive econom ic and trade policy refo rms, which would boost 
Turkey’s commitment to the multilateral trading system , and the pursuit of further liberalization in the 
Doha Round. 
40. The representative of Australia  noted Turkey's progress in implementing its fourth economic 
stabilization programme.  Australia and Turkey were  important trading partne rs and had established a 
Joint Economic Commission to promote bilateral trad e and investment.  Australia was concerned at 
the high tariff protection and licensing requirements Turkey maintained for many agricultural and 
food products.  Australia appreciated Turkey's comm itments to the DDA and shared Turkey's view on 
the need for all parties to make concessi ons in order to achieve real gains.  
41. The representative of Hong Kong, China  was pleased that Turkey had continued to liberalize 
its tariff regime, and encouraged Turkey to fu rther its liberalization efforts and enhance the 
transparency and predictability of its tariff regime.  Hong Kong, China hoped th at the high number of  WT/TPR/M/125 
 Page 11 
 
 
Turkish standards, which had increased by 40% since 1998, would not pose obstacles to trade.  
Turkey's two new laws on government procurem ent enacted in 2002, provided for additional 
transparency, accountability and competition, while en suring a more effective and efficient use of 
public resources.  Hong Kong, China appreciated Turk ey’s vigorous efforts in the enforcement of 
legal action against infringements of intellectual pr operty rights.  It also commended Turkey for its 
continuous efforts in educating the public by launching an anti-piracy campaign. 
42. Hong Kong, China was pleased that Turkey was implementing a wide-ranging five-year 
Agricultural Reform Implementation Project (ARIP) to  make the agricultural sector more competitive.  
It was also glad that Turkey supported an equ itable agricultural trading environment in the DDA 
negotiations.  Turning to textiles and clothing, th e representative of Hong Kong, China urged Turkey 
to remove its quantitative restrictions as soon as possi ble.  He encouraged Turk ey to undertake further 
liberalization in services and to take a more active part in the WTO services negotiations. 
43. The representative of the United States  stressed the strong bilateral trading relationship with 
Turkey.  She pointed out Turkey's economic progr ess since the 2001 financial crisis.  Turkey had 
restored confidence, and exceeded many of the eco nomic targets set out by the IMF programme.  A 
decline in Turkey's average tariff level resulted in modest progress on trade liberalization.  About 
46.3% of Turkey’s tariff lines were bound;  furthe r tariff binding commitments would introduce more 
predictability into the trade regime, and enhance Turkey's integration into the multilateral trading 
system.  She welcomed Turkey’s trade-related legislative reforms to conform with WTO 
requirements, and encouraged Turkey to press forw ard in its effort to accede to the WTO GPA.  
44. Turkey had made important structural reforms, and had plans for privatization, but more work 
was needed to ensure that Turkey was embarked on a path of sustained ec onomic growth that would 
bring financial stability, and improve the Turkish st andard of living.  Turkey needed to attract 
significant foreign and domestic investments to grow and meet its financial commitments.  For this, it 
needed to reduce red tape, continue tax reform, a nd increase transparency.  Protection of intellectual 
property rights would foster the knowledge-based i ndustries promoting Turkey’s long-term growth.  
She said that the United States would continue  to support Turkey's process of reform. 
45. The representative of the European Communities  noted that further cooperation between 
Turkey and EC Member States had continued for a number of years with the establishment of a customs union on 31 December 1995.  Turkey had taken important steps with regard to entering into 
FTAs and the upcoming enlargement of the EU in 2004 was an additional cha llenge. He recalled that 
a number of developing countries were substantially  poorer than Turkey, and might require greater 
preferences and assistance.  Turkey’s alignment w ith the EC tariff regime was to result in the 
country’s application of the EC’s  GSP, which would help improve the structure setting for LDCs.  
46. The representative noted Turkey’s strong commi tment in the Doha process. He said that 
Turkey would benefit from further liberalization for both industrial and non- industrial products as 
well as services.  In addition, an Agreement on investment would, among many benefits, provide a 
global framework for Turkey’s increasing foreign investments, and an Agreement on competition 
would help to initiate work on competition policy,  which was vital for ensuring a strong market 
economy in the long run.  
47. The representative of Colombia
 highlighted Turkey's good performance through the economic 
stabilization programmes.  The 2001 programme woul d help Turkey to achieve economic and FDI 
growth, and to reduce inflation.  Colombia stress ed Turkey's commitment to the multilateral trading 
system.  It encouraged Turkey to develop its reform s in new areas, and to rationalize its tax structure.  
Colombia welcomed Turkey's commitment in the ne gotiations on non-agricultural market access, and 
in binding all its tariff lines.  The representative not ed the effort to eliminate certain measures that WT/TPR/M/125 
Page 12  
 
distorted production, and hoped that the restructur ing programme for agriculture, and the plans to 
privatize the mining and energy sectors would be  positive.  The agriculture, mining and energy 
reforms would enable Colombia to consolidate its ex ports to Turkey, and  Colombia would remain an 
open market to Turkish exports. 
48. The representative of Chinese Taipei
 said that the economic stabilization programme 
introduced in 2001 in response to the economic cris is of the same year had already shown positive 
results. However, a huge external debt remained, and trade deficit problems also needed to be 
addressed. He noted that the amount of trade and in vestment between Turkey and Chinese Taipei was 
surprisingly meagre, and believed that there was gr eat potential in the years ahead to strengthen the 
bilateral economic ties given Turkey's geographic loca tion and its firm commitment to liberalization.  
The representative referred to his delegation's adva nce question regarding a new law to establish the 
"Investment Promotion Agency of Turkey", and requested an update of progress to date on the 
streamlining of FDI regulations, which he unders tood were a policy priority of the Turkish 
Government.  
49. The representative of Norway  highlighted Turkey's efforts in implementing reform 
programmes, and the positive results of the 2001 pr ogramme.  Norway welcomed the law on foreign 
investment, which would provide Turkey with impor tant FDI inflows.  Turkey was an important 
participant in world trade and in the WTO, and cooperated with the EFTA States through the 1991 
FTA.  Norway's bilateral trade with Turkey had in creased steadily;  Turkey was an important market 
for Norwegian goods and services.  Norway encour aged Turkey to simplify its trading regime, 
including its tariff;  to reduce its bound tariff rates;  and to bind the applied rates. 
50. The representative of Indonesia  asked for clarification of Turkey's criteria in 
appointing/choosing the 52 countries on which quantita tive restrictions were applied on imports of 
textile and clothing.  He asked wh ether the policy also applied to processed textiles and clothing, and 
what Turkey's intention would be after the elimin ation of quotas in 2005.  The representative also 
asked details on: the differences between organized  industrial zones and free zones;  what activities 
were allowed for foreign investors;  what polic y was on distribution products, labour and service 
between one free zone to another;  and eventual charges.   
51. The representative of Venezuela  stated that Turkey had faced both internal and external 
difficulties that had an influence in its economi c performance, its stability, and its investments 
inflows.  Venezuela encouraged Turkey to continue  reducing its structural vulnerability, and attracting 
investments.  Trade between Venezuela and Turk ey had increased since 2000.  Venezuela exported 
mainly mineral products but was interested in divers ifying its bilateral trade flows, which was why an 
initiative that could facilitate business was under negotiation.  
52. The representative of Singapore  noted that Turkey was Singapore's 52nd biggest trading 
partner in 2002.  Singapore welcomed Turkey's economic stabilization programme, and its continuing 
transformation from a state-directed system to a free market system.  The 2001 economic programme 
had shown positive results;  it would address the main obstacles to growth.  Singapore commended 
Turkey for tackling inflation, and addressing some of its structural problems.  The representative 
highlighted the active role of Turk ey into the WTO, and the great im portance it attached to the DDA.  
53. The representative of Morocco  indicated that Turkey and Morocco shared many economic, 
political, and cultural views.  They had concluded some major bilateral and regional initiatives, which 
would bring a high level of partne rship, development, and investment to both countries.  Morocco 
commended Turkey's efforts to implement the WTO Ag reement, and its active role in the negotiations 
of the Doha Agenda.  Turkey had worked hard to  harmonize its regimes with those of the EU.  The 
representative noted the positive economic resu lts obtained through the reforms adopted.  WT/TPR/M/125 
 Page 13 
 
 
54. The representative of Bulgaria  stated that the TPR allowe d Members to assess Turkey's 
efforts to strengthen its economy, to improve the i nvestment environment, to develop its policies, 
institutions and external trade relations and to c ontinue playing its active role in the multilateral 
trading system.  Turkey had had to face many challenges in its difficult transformation from a 
protected, state-directed economic system to a free market system. Bulgaria supported Turkey’s 
efforts to implement ambitious reforms because it be lieved such reforms were essential to improve the 
climate for foreign investment and to curb inflati on, and contributed to the strong growth performance 
of the Turkish economy. 
55. Bilateral cooperation between Turkey and Bulg aria was being developed in all spheres and 
was underpinned by an Economic, Industrial and T echnical Cooperation Agreement.  Turkey was 
Bulgaria’s 12th largest investor, its fifth biggest tradi ng partner in 2003, and ranked second in trade 
with the Balkan countries. Bulgaria appreciated Tu rkey's efforts to contribute to the economic and 
political stability in the region, through regional c ooperation initiatives and commended Turkey for its 
strong commitment to the multilateral trading syst em and its active par ticipation in the WTO 
negotiations. She encouraged Turkey to continue its  internal policy and institutional development. 
56. The representative of China  was to note the rapid development of Turkey's economy resulting 
from a series of measures including economic stabilization programmes, continuous trade 
liberalization, restructuring of domestic industries,  and improving the investment environment.  China 
appreciated Turkey’s efforts in amending legislation in order to strengthen the legal framework and to 
fulfil its WTO obligations. She also hoped that Turkey would better implement WTO provisions on 
customs valuation, rules of origin, technical regula tions, inspection, and quarantine, so as to serve the 
aim of trade facilitation. 
57. The representative noted that the Sino-Turkey trade relationship had developed smoothly and 
healthily.  However, bilateral trade accounted fo r only a very small percentage in the total trade 
volume of both countries, and therefore there wa s great potential for further development. The 
Chinese Government looked forward to promoting Si no-Turkey bilateral trade, and that China was 
also willing to work together with Turkey to cont ribute to the healthy and steady development of the 
multilateral trading system. 
58. The representative of India  noted that the reform process initiated since 1980 had led to a 
significant transformation of the Turkish economy fro m a state controlled system to an open and 
liberal economic and trading regime.  India we lcomed the significant economic upswing in 2002, 
when Turkey achieved GDP growth of 7.8%, and hoped that this would be sustained.  With the 
establishment of customs union with the EU, Turk ey had been harmonizing its tariff structure and 
other trade policy instruments with those of the EU .  However, the customs union had also generated 
an imperative for Turkey to align its regime with  the EU's preferential regimes and he hoped that 
Turkey would take the necessary steps to avoid nega tive effects on its non-preferential partners.  The 
trade volume between Turkey and India had been growing, and India wished to establish closer 
commercial relations with Turkey in the banking and financial sectors.  
59. The representative of the Czech Republic  noted that Turkey had opened its economy through 
various liberalization measures, and had firmly s upported the multilateral trading system.  The Czech 
Republic was interested in further developing its b ilateral trade and other relations with Turkey.  The 
representative hoped that Turkey's various non-ta riff obstacles to Czech exports would decrease.  
60. The representative of Pakistan  said that despite a long history of excellent relations trade with 
Turkey remained low;  he hoped it would incr ease due to a new trade arrangement.  Pakistan 
commended Turkey's continued transformation of its economy into a free market, and suggested that WT/TPR/M/125 
Page 14  
 
Turkey might consider increasing its binding level of tariffs.  The representative noted the impressive 
reform of customs procedures, and Turkey's positive role in the DDA. 
61. The representative of Poland
 recognized Turkey's important role in the WTO, and its support 
for the multilateral trading system.  Turkey has taken significant steps to stabilize its economy, and 
the reform programme in response to the 2001 crisis  had been effective.  Turkey was an important 
trade partner for Poland;  their trade turnover was increasing steadily.  Poland currently ran a trade 
deficit with Turkey and it hoped that bilateral trad e relations would become more dynamic and more 
balanced.  Poland supported Turkey's efforts to accede to the EU.  
62. The representative of the Republic of Korea  noted that Turkey had been active in reforming 
its economic and trade regime to im prove its level of liberalization.  Turkey had been an important 
economic and political partner for Korea.  After a slowdown in 2000, bilateral trade was again 
showing signs of increasing.  Korea hoped that economic relations would continue to grow.  
63. The representative of the Slovak Republic  noted that despite four economic stabilization 
programmes with a focus on trade and investment reforms, Turkey's economic situation remained 
fragile due to the net debt burden in the public sector  and low amount of FDI.  The tariff remained the 
main instrument of Turkey’s trade policy, and he welcomed the decline of average tariffs. He also 
appreciated Turkey's efforts in improving legislati on in the areas of customs, anti-dumping, standards 
and technical regulations, intellectual property rights  and others, to make them compatible with WTO 
Agreements. 
64. The Slovak Republic welcomed the implemen tation of Turkey's wide-ranging five-year 
programme to restructure the agriculture sector.  Th e State still exerted a direct and strong influence 
on the economy, a complex system of state aids to manufacturers remained in place, and some 
services providers in important sectors operated und er monopoly or exclusive rights;  improvements 
might be possible through structural reform pr ivatization and enhanced competition.  The 
Slovak Republic had signed a free-trade agreemen t with Turkey in 1997, which allowed duty free 
movement of industrial goods betw een the two countries and created opportunities for further growth 
of mutual trade and economic cooperation.  He enc ouraged Turkey to continue its economic reforms, 
including trade liberalization, in order to provi de the basis for a sustained economic growth, and 
attract more foreign investment.  WT/TPR/M/125 
 Page 15 
 
 
V. REPLIES FROM THE REPRESENTATIVE OF TURKEY AND ADDITIONAL 
COMMENTS 
65. The Chairperson invited the representative of Turkey to focus her responses on three main 
themes:  (i) economic environment;  (ii) trade policies;  and (iii) sectoral issues.   
(i) Economic environment 
 
66. The representative noted that having introduced st ructural reforms Turkey had been able to 
gain flexibility and competence in time;  and t hus the Turkish economy had not been seriously 
affected by external shocks.  The current economic programme was ai med at achieving and 
maintaining price stability.  The 2003 November in flation rate (19.3%) indicated that the year-end 
inflation target (20%) was attainable;  a target of  12% had been set for 2004.  Tax reform, expanding 
public sector productivity, improving the investment environment, and increasing competitiveness would contribute to the downward trend in inflatio n.  The domestic debt situation had improved due 
to:  the decline of real interest rates;  the primary surplus;  the GDP growth;  and to positive 
expectations.   
67. The structural reforms were to re-identify the role of the State in the economy as a regulator 
rather than an operator.  Direct state intervention had been, and would be, diminished in the scope of 
privatization policies.  In sectors such as banki ng, energy, and telecommunications where market 
disparities existed, independent regulatory agencies  had been established to regulate free market 
operations.  
68. Turkey had taken solid steps to attract FDI but the economic conditions and the regulatory 
framework had not helped to achieve the desired effects.  A Decree on Improving the Investment 
Climate in Turkey was enacted in 2001, and a Co ordination Council for Improvement of Investment 
Environment was established to identify and remove regulatory and administrative barriers to private 
investments.  Substantial results had been produced, and foreign investors could now invest in Turkey 
under a sole notification system.  The law estab lishing the Investment Promotion Agency, an 
institution supported by the public and private secto rs to promote the investment conditions, was 
under revision.  Efforts were being made to a ssure a sustainable, open foreign-investment 
environment in Turkey.  Turkey would continue to support the work undertaken by the WTO Working Group on Investment to develop a common  understanding and a framework for investment. 
69. Turkey, as a country bridging different regi ons, considered bilateral and regional trade 
relations as a valuable opportunity to enhance trade liberalization and strengthen existing ties.  In that 
sense, some outstanding steps had been taken:  the customs union with the EU;  and the pro-active strategy of developing economic re lations within the region.  However, Turkey considered those 
initiatives as complementary tools, and remained full y committed to the liberalization of trade at the 
multilateral level.  Indeed, Turkey continue d its efforts to push forward the DDA.  
(ii) Trade policies 
70. On customs, the representative believed that a rapid, standard, and less bureaucratic customs 
service could be achieved by improving infrastructur e and technological capabilities.  In that regard, 
Turkey had highly competent customs;  complain ts were at a minimum, though not yet totally 
eliminated.  International trade commitments had urged Turkey to take solid measures on customs 
procedures.  Turkey was one of the strong propon ents of an international arrangement on trade 
facilitation.  Turkey's specialized customs fe ature had accelerated procedures and facilitated 
communication between the importer or exporter and the qualified officers.  The current Customs 
Law addressed customs valuation.  In practice, Turkey was using its right stemming from the WTO WT/TPR/M/125 
Page 16  
 
Customs Valuation Agreement not to reverse the de ductive and computed valuation methods, and no 
request to the contrary had been received from importers. 
71. On the tariff structure, Turkey had a very mode rate level of protection, with a 4.4% average 
rate on industrial products.  However,  almost two thirds of imports had duty-free access to the Turkish 
market if the customs union with the EU, the FTAs, and the GSP were taken into account.  Ad 
valorem  duties accounted for 98.5 % of Turkey's tariff lines.  The non- ad valorem rates had been 
necessary for the functioning of the customs union w ith the EU, and were reviewed periodically to 
ensure that the WTO bound rates were not exceeded. 
72. At the end of the Uruguay Round, Turkey had bo und 46.3% of all its tariff lines, and intended 
to bind the rest at the end of the Doha Round.  Turkey had offered an ambitious modality in the non-
agricultural market access ne gotiations to reduce all bound rates to a ceiling level.  
73. Internal taxes were implemented in line w ith Turkey's WTO commitments, without any 
discrimination between domestic and imported pr oducts.  An exceptional Mass Housing Fund levy 
was charged on the imports of fish and fishery prod ucts, which were not part of Turkey's National 
Schedule of Concessions. 
74. Imports of certain products were prohibited only on grounds of environment protection, 
public security, health, public morals or to co mply with international obligations.  The 
implementation of import licences was in line with the WTO Import Licensing Agreement.  
Automatic licences originated in pub lic security, health, environment, and consumer rights.  Turkey 
implemented some quantitative measures in textiles, after it became a party to the Customs Union, but 
these were not intended to impede trade among th e Customs Union partners.  On protection of 
domestic industries, Turkey’s implementation of tr ade remedies was in line with the Anti-Dumping 
and Safeguards Agreements.  Nevertheless, Turkey had never considered, or used, contingency trade 
remedies as a restriction in international trade.  
75. A new Public Procurement Law had been enacted recently.  The Public Procurement 
Authority, and the system itself were new institutions .  The objective was to adopt the best practice, 
and set up a transparent environment for the econom ic agents.  In this context, Turkey was 
considering becoming a party to the WTO Agreemen t on Government Procurement.  Regarding the 
15% price margin for domestic supplier, this was for tenders exceeding the threshold values, and it 
provided competitive advantage for domestic suppliers.   
76. The Decree of the Regime for Technical Regula tions and Standardization for Foreign Trade 
regulated standards and other technical require ments.  The regime was aimed at providing 
transparency, and ensuring compliance with the requ irements of health, safety, and protection of the 
environment, as laid down in the WTO Agreements. 
77. Turkey had received questions on  sanitary and phytosanitary matters, and particularly the role 
of the Control Certificate (CC) System.  The CC was a reference document for SPS purposes on which the importer confirmed the conformity of the imported products with the SPS measures.  The 
CC also provided the authorities with details on:  th e country of origin, the entry point, the importer 
and the exporter, and other statistical data.  The CC made sure that the documents were complete, and 
avoided further cost to the importer.  It was is sued without any discrimination, or any quantitative 
limitations.  However, the authorities were awar e of certain difficulties stemming from insufficient 
infrastructure and technical incapabilities, and were in contact with trading partners to resolve existing 
problems.   WT/TPR/M/125 
 Page 17 
 
 
78. On export subsidies, Turkey was eligible to apply export subsidies to certain agricultural 
products in line with the Agreement on Agriculture .  Turkey implemented its subsidy schemes in 
conformity with its reduction commitments, which woul d end in 2004.  In the ongoing negotiations on 
agriculture, Turkey had proposed a reduction of expo rt subsidies if developed countries eliminated or 
substantially reduced their export subsid ies and domestic support to agriculture. 
79. Regarding export promotion and assistance, the St ate Aid Programs for exports were aimed at 
improving export capacity of small and medium-si zed enterprises in areas such as research and 
development, environment, and employment.  In  addition, the Turkish Eximbank managed credit, 
guarantee, and insurance programmes.  
80. Investment incentives came under the two ma in headings of general investment 
encouragement program, and the aids granted to small and medium-sized enterprises.  Both 
programmes covered all investment activities relate d to the production of goods and services, research 
and development, environmental pr otection, and improvement of qualit y and standards.  Since more 
than one institution granted these aids and the syst em was not very productive, and a study was under 
way had been launched to prepare a draft law to est ablish a mechanism or a body to be responsible for 
monitoring and evaluating state aid programmes in Turkey.  
81. In September 2003, the total trade volume in the 11 Turkish free zones amounted to 
US$15 billion, of which 55% was destined to othe r countries, and 45% to Turkey.  The free zones 
were mainly export-oriented facilities for fore ign and Turkish investors who enjoyed special 
incentives.  
82. On intellectual property rights, Turkey had been gradually updating its legislation and 
improving its enforcement.  The first IPR Review of Turkey, in 2000, had confirmed that Turkey's 
IPR regime was harmonized with the TRIPS Agreem ent.  An increase of IPR infringements had been 
noticed following Turkey's two economic crises.  Turkey had adopted new IPR legislation that 
included a code on geographical indications and est ablished two new special courts in Istanbul.  
Turkey envisaged setting up more courts of a sim ilar nature, to increase human resources and improve 
infrastructure in this field.  Turkey was ke en to create awareness in its society through the 
organization of symposia and public campaigns. 
(iii) Sectoral issues 
83. With respect to agriculture, Turkey had been  implementing an ambitious reform programme 
aimed at, inter alia , enhancing the existing conditions in line  with the relevant WTO provisions and 
commitments.  Particular effort was being made to rebuild national livestock capacity one third of 
which had been lost in the last two decades.  Alt hough Turkey's agricultural bindings were quite high, 
it had a tariff-only system.  Turkish commitments under the Agreement on Agriculture did not include 
any tariff quotas, and domestic support was within the de minimis  level. 
84. Agricultural products were covered by the Cu stoms Union between Turkey and the EU.  
However, the parties had agreed to postpone th e free movement of agricultural products, and 
committed themselves to improve market access c onditions, until Turkey's adoption of the EU's 
Common Agricultural Policy (CAP).  Nevertheless, preferences granted for trade in agricultural 
products accounted for a large portion of total agricultu ral trade, as a result of a separate Decision of 
the Association Council.  With its implementa tion in 2002, approximately 97% of Turkey's 
agricultural exports to the EU benefited from pref erences, while EU preferen tial access to the Turkish 
market amounted to 45%. WT/TPR/M/125 
Page 18  
 
85. The energy sector had been subject to restruct uring recently.  Turkey had taken steps against 
the negative impact of the high energy prices on the industries.  The new legal framework for 
electricity and natural gas was aimed at ensuri ng that energy prices were determined within a 
competitive market structure, in a cost reflective manner. 
86. Turkey had been actively and constructively e ngaged in the WTO services negotiations since 
2000.  To achieve its DDA objectiv es, Turkey expected flexibility from developed countries, and 
hoped that its fellow developing partners would be nefit from the negotiation process.  Within the 
negotiating framework, Turkey put forward its desi re for further liberalization in engineering, 
architectural, construction, and re lated engineering, as well as financial, tourism, and air and road 
transport services.   
87. On data protection, Turkey agreed that pr otection of confidential business information was 
important to attract FDI in its pharmaceuticals sect or.  Turkish legislation on data protection was in 
line with Turkey’s WTO TRIPS commitments.  Neve rtheless, Turkey hoped its trading partners 
would take into consideration its  economic, financial, social, and political circumstances.  Turkey 
aimed to streamline its IPR regime to that of the EU;  once achieved, it would be implemented on an 
MFN basis, in line with the WTO rules. 
88. With respect to the economi c environment, the discussant
 stressed that macroeconomic had 
policies had improved Turkey's economy, and main tained better conditions for investment.  On 
measures related to trade and trade policy framewo rk, Turkey's intention was to make customs 
procedures easier.  On tariff bindings, under the Customs Union with the EU, for industrial products at least, Turkey intended to maintain the level of  the CET.  Regarding Turkey's interests in the 
upcoming services negotiations under the DDA, he thoug ht it would be interesting to see whether 
Turkey would force market opening in that sector.   WT/TPR/M/125 
 Page 19 
 
 
VI. CONCLUDING REMARKS BY THE CHAIRPERSON  
89. This meeting has allowed us to improve our understanding of the developments in the trade 
policies and practices of Turkey since its previous  Review in 1998, and of the challenges that lie 
ahead. Our dialogue has been thorough and comp rehensive, stimulated by Ms. Ülker Güzel, 
Undersecretary of Foreign Trade, and her delegati on, as well as by the incisive comments by our 
discussant, H.E. Ambassador Péter Balás. 
90. Members appreciated steps taken by Turkey to stabilize its economy, and encouraged it to 
continue its structural reforms.  They praised Tu rkey for the  2002-04 reform programme, initiated in 
response to the 2000-01 economic crisis.  Members expressed hope that the programme would help 
redress Turkey's economic situation, which remain ed fragile with high inflation and public 
indebtedness, and economic grow th alternating with recession. 
91. Members noted Turkey's commitment to the multilateral trading system and to the WTO. 
Some Members noted that accession to the EU remained Turkey's ultimat e objective.  In this context, 
Turkey's trade policies are increasingly being pursued  through bilateral and re gional trade agreements 
in order to comply with its obligations under the customs union with the EU.  Some Members 
expressed concern that participation in preferentia l arrangements might further complicate Turkey's 
trade regime.  Some Members remark ed that Turkey is applying non- ad valorem  tariffs to products on 
which it bound tariffs at ad valorem  rates.  They pointed out that further tariff reform, including 
reduction of the margins between bound and applied rates, would enhance the predictability of the 
tariff regime.  Concerns were expressed about Turkey 's relatively large use of anti-dumping measures.  
92. Members praised Turkey's wide-ranging 2001-05 programme to restructure agriculture, but 
called attention to the insulation of the sector from competition as a result of its exclusion from 
Turkey's preferential trade agreements, high ta riff protection, and government support. They 
commended Turkey for having taken steps to liberali ze the electricity and natural gas subsectors, and 
for addressing some structural problems face d by services activities, such as banking and 
telecommunications. 
93. Members also sought clarification on other i ssues, notably: customs procedures; internal 
taxation; import licensing; standards and SPS; export and investment incentives; government 
procurement; protection of intellectual property ri ghts; state involvement in mining, energy and 
manufacturing; and trade reforms in various services subsectors. 
94. Members expressed their appreciation for the r esponses to their questions as provided by the 
Turkish delegation; they looked forward to recei ving written answers to an y outstanding questions.  
95. In conclusion, it is my belief that the large num ber of advance written questions, and the high 
level of attendance indicate the important role that Turkey plays in the multilateral trading system.  I encourage Turkey to continue improving its mu ltilateral commitments and  implementing its 
economic reform programme, with a view to enhanc ing the predictability and credibility of its trade 
regime.  Trading partners can help by ensuring that  their markets are fully open to Turkey's exports. 
 
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