WORLD TRADE  
ORGANIZATION  WT/REG86/R/B/3 
G/L/686 
6 September 2004 
 (04-3693) 
Committee on Regional Trade Agreements Original:   English 
   
EFTA-TURKEY FREE TRADE AREA 
 
 
 The following communication, dated 26 August 2004,  is being circulated at the request of the 
EFTA States. 
_______________ 
 
Biennial Report on the Operation of the Agreement
 
 
Communication from the Parties 
 
Introduction 
 
 The Agreement between the Member States of  the European Free Trade Association (EFTA) 
and Turkey was examined in accordance with Article XXIV of GATT. In accordance with the 
recommendations approved by the Council for Trade in Goods1, as recommended by the Committee 
on Regional Trade Agreements2, and the reporting schedule established by the WTO Secretariat3, the 
Parties to the Agreement establishing the Free Tr ade Area between the EFTA States and Turkey 
herewith provide their biennial report on the ope ration of the Agreement covering the period 2001-
2003. The Parties to the Agreement submitted a bien nial report on the operation of the Agreement on 
8 August 2001, circulated in WT/REG86/R/B/2;G/L/349.  Main Developments 
 
 The Parties have continued to pay attention to updating and upgrading the Agreement. During 
the reporting period (2001-2003), the Joint Commit tee held one meeting on 5 November 2002, and 
has adopted four Joint Committee D ecisions (regarding amendments to Protocol B, Annex II, and two 
Decisions regarding amendments to Protoc ol A). For further details, see Annex I.  
 
 
I. BACKGROUND INFORMATION ON THE AGREEMENT 
1. Membership And Dates Of Signature, Ratification And Entry Into Force 
 The Agreement establishing a Free Trade Ar ea between the EFTA States and Turkey was 
signed on 10 December 1991. The Agreement has been  in force since April 1992 (September 1992 for 
Iceland). Austria, Finland and Sweden ceased to be Parties to the FTA, following their withdrawal 
from the EFTA Convention and subsequent accession to  the European Union on 1 January 1995. The 
Agreement can be consulted on the EFTA web page:   
http://secretariat.efta.int/Web/Externa lRelations/PartnerCountries/Turkey  
2. Trade Data 
 
                                                     
 
1 G/L/286. 
2 WT/REG/4. 
3 WT/REG/W/48. WT/REG86/R/B/3 
G/L/686 Page 2 
 
  According to the EFTA Secretariat’s statis tical sources, overall trade between the EFTA 
States and Turkey increased by 70.9 per cent in the period from 2001 to 2003. EFTA imports from Turkey increased by 57 per cent and EFTA exports  to Turkey increased by 76.7 per cent during the 
same period. 
 
 The trade balance between the two was in favour of the EFTA States in the period 2001 to 
2003. In 2003, EFTA exports to Turkey amounted to 1,625 million US dollars while imports from 
Turkey amounted to 600 million US dollars.  
 Among the EFTA States, Switzerland was Turk ey’s largest trading partner in 2003, 
accounting for 69.7 per cent of the trade, followed by Norway with 29.3 per cent and Iceland with 1 per cent.   In the period 2001 to 2003, the EFTA States’ to tal trade with the world increased by 19.5 per 
cent, or in absolute terms from 258.5 billion US dollars to 308.8 billion US dollars. Both import and 
export figures showed the same positive trend.   In the period 2001 to 2003, Turkey’s share of EFTA’s total trade with the world increased 
from 0.50 per cent to 0.72 per cent. With regard to  other free trade partners, the share of Turkey’s 
trade with the EFTA States’ total preferential trade (this includes trade with the 15 EU Member States 
and 20 free trade partner countries) increased from 0. 67 per cent in 2001 to 0.95 per cent in 2003. 
  Detailed trade data can be found in Annex II.   II. TRADE PROVISIONS 
1. Import & Export Restrictions 
 
 Iceland abolished the legal basis for the customs duties of a fiscal nature specified in list 2 to 
Table VII to Protocol A in a decision taken on 14 June 2001.  2. Rules Of Origin 
 
 Since all Parties to the Agreement are include d in the system of pan-European cumulation 
system, amendments to Protocol on Origin Rules (Protocol B) were made in 2002 (see Annex I).  
 
  
III. GENERAL PROVISIONS OF THE AGREEMENT 
1. Institutional Framework 
 
 A Joint EFTA-Turkey Committee has been estab lished under the Agreement. The aim of the 
Joint Committee is to supervise and administer the implementation of the Agreement as well as 
review the possibility of further removal of obs tacles to trade between the Parties. The Joint 
Committee is assisted by expert groups, in partic ular by the Sub Committee on Customs and Origin 
Matters. Other expert groups can be convened, as agreed. During the reporting period, the sixth Joint 
Committee took place on 5 November 2002 in Ankara, preceded by a meeting of the Sub-Committee on Customs and Origin Matters the day before.  
_______________ 
 
   WT/REG86/R/B/3 
 G/L/686 
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ANNEX I 
 
Amendments to the EFTA-Turkey FTA 2001 - 2003 
 
Articles/ 
Annexes Description Amendments/ 
Deletions Remarks Entry into Force 
Protocol A Processed 
agricultural 
products Amended by 
written procedure 
14 June 2001 List 2 of Table VII to 
Protocol A deleted, and 
technical amendments Entered into force 
01.07.2001 
Protocol B Rules of Origin Amended  
JCD of 05.11.2002 Technical amendments Entered into force 
01.01.2003 
Annex II Fish and other 
marine products Amended  
JCD of 05.11.2002 Technical amendments Entered into force 
01.01.2003 
Protocol A Processed 
agricultural 
products Amended  
JCD of 05.11.2002 Technical amendments Entered into force 
01.01.2003 
 
 
ANNEX II 
 
Detailed Trade Data 
 
Statistical information on:   
• EFTA States’ trade with Turkey 2000-2003 
 
• EFTA States’ trade with Turkey by selected commodities (HS) 2000-2003 
 
• Development of EFTA States’ trade with Turkey 1992-2003 
 
• EFTA States’ trade with the world 2000-2003 
 
• EFTA States’ trade with the world by selected commodities (HS) 2000-2003 
 
• Development of EFTA States’ trade with the world 1992-2003 
 WT/REG86/R/B/3 
G/L/686 Page 4 
 
 
 2000 2001 2002 2003 2001/00 2002/01 2003/02
                  In thousand US dollars    Percentage change
IMPORTS
Iceland 6,431 6,639 8,308 20,232 3.2 25.1 143.5
Norway 115,595 115,393 163,736 258,013 -0.2 41.9 57.6
Switzerland 238,446 260,244 264,831 321,974 9.1 1.8 21.6
EFTA 360,473 382,276 436,875 600,219 6.0 14.3 37.4
Share in EFTA's tot. imports 0.30% 0.33% 0.37% 0.43%
EXPORTS
Iceland 1,348 796 927 1,276 -41.0 16.5 37.7
Norway 182,011 205,037 302,911 395,029 12.7 47.7 30.4
Switzerland 833,309 714,193 1,025,542 1,228,982 -14.3 43.6 19.8
EFTA 1,016,669 920,026 1,329,379 1,625,287 -9.5 44.5 22.3
Share in EFTA's tot. exports 0.72% 0.65% 0.88% 0.95%
IMPORTS + EXPORTS
Iceland 7,780 7,435 9,235 21,508 -4.4 24.2 132.9
Norway 297,607 320,430 466,647 653,042 7.7 45.6 39.9
Switzerland 1,071,755 974,437 1,290,372 1,550,956 -9.1 32.4 20.2
EFTA 1,377,142 1,302,302 1,766,254 2,225,506 -5.4 35.6 26.0
Share in EFTA's total trade 0.53% 0.50% 0.65% 0.72%
-- no percentage calculated
Source: World Trade AtlasEFTA STATES' TRADE WITH TURKEY
20.23 1.282583953221,229
02004006008001,0001,2001,400
Iceland Norway SwitzerlandEFTA States' trade with Turkey
(2003 - million US dollars)
Imports
Exports WT/REG86/R/B/3 
 G/L/686 
 Page 5 
 
 
 EFTA STATES' TRADE WITH TURKEY BY SELECTED COMMODITIES (HS)
Source: World Trade Atlas 2001 2002 2003 2001 2002 2003 
IMPORTS In thousand US dollars In per cent
Iceland
Total imports from Turkey 6,639 8,308 20,232 100.0 100.0 100.0 
In per cent of imports from the world 0.32% 0.40% 0.78%
HS 87 Vehicles (not railway) 20 368 4,926 0.3 4.4 24.3 
HS 94 Furniture and bedding 235 243 3,560 3.5 2.9 17.6 
HS 61 Knitted apparel or clothing accessories 1,917 2,221 3,053 28.9 26.7 15.1 
Norway
Total imports from Turkey 115,393 163,736 258,013 100.0 100.0 100.0 
In per cent of imports from the world 0.37% 0.48% 0.66%
HS 61 Knitted apparel or clothing accessories 32,968 45,773 67,390 28.6 28.0 26.1 
HS 62 Woven apparel or clothing accessories 25,480 38,016 49,477 22.1 23.2 19.2 
HS 87 Vehicles (not railway) 503 11,223 38,020 0.4 6.9 14.7 
HS 89 Ships, boats and floating structures 79 5,522 19,486 0.1 3.4 7.6 
HS 85 Electrical machinery 7,092 11,546 15,431 6.1 7.1 6.0 HS 63 Miscellaneous textile articles 6,492 7,945 9,446 5.6 4.9 3.7 
HS 08 Fruit and nuts 6,693 7,049 7,505 5.8 4.3 2.9 
HS 84 Machinery, mechanical appliances 2,966 4,389 6,998 2.6 2.7 2.7 
Switzerland
Total imports from Turkey 260,244 264,831 321,974 100.0 100.0 100.0 
In per cent of imports from the world 0.31% 0.32% 0.33%
HS 61 Knitted apparel or clothing accessories 39,743 49,432 60,047 15.3 18.7 18.6 
HS 08 Fruit and nuts 48,106 37,826 39,908 18.5 14.3 12.4 
HS 62 Woven apparel or clothing accessories 26,452 33,825 37,743 10.2 12.8 11.7 
HS 30 Pharmaceutical products 12,507 13,449 23,868 4.8 5.1 7.4 HS 87 Vehicles (not railway) 25,122 20,142 21,466 9.7 7.6 6.7 
HS 63 Miscellaneous textile articles 14,129 14,650 20,702 5.4 5.5 6.4 
HS 85 Electrical machinery 9,697 13,795 19,578 3.7 5.2 6.1 
HS 84 Machinery, mechanical appliances 9,901 5,968 10,048 3.8 2.3 3.1 
HS 57 Textile floor coverings 5,253 5,096 8,723 2.0 1.9 2.7 HS 76 Aluminium and articles thereof 6,397 5,877 8,227 2.5 2.2 2.6 
EXPORTS In thousand US dollars In per cent
Iceland
Total exports to Turkey 796 927 1,276 100.0 100.0 100.0 
In per cent of exports to the world: 0.04% 0.04% 0.05%  
HS 38 Misc. chemical products 332 493 528 41.7 53.2 41.4 HS 43 Furskin and artificial fur 28 193 148 3.6 20.9 11.6 
HS 03 Fish, crustaceans 0 0 147 0.0 0.0 11.5 
Norway
Total exports to Turkey 205,037 302,911 395,029 100.0 100.0 100.0 
In per cent of exports to the world: 0.36% 0.50% 0.59%
HS 27 Mineral fuels, oil 113,781 167,922 211,881 55.5 55.4 53.6 
HS 76 Aluminium and articles thereof 26,286 43,171 59,699 12.8 14.3 15.1 
HS 89 Ships, boats and floating structures 417 1,657 25,884 0.2 0.5 6.6 
HS 99 Salvage and reparations 13,023 16,950 17,936 6.4 5.6 4.5 
HS 84 Machinery, mechanical appliances 9,208 11,275 15,382 4.5 3.7 3.9 HS 03 Fish, crustaceans 5,115 7,559 11,691 2.5 2.5 3.0 
HS 48 Paper, paperboard 3,897 6,332 9,813 1.9 2.1 2.5 
HS 93 Arms and ammunition 9,744 22,322 6,406 4.8 7.4 1.6 
Switzerland
Total exports to Turkey 714,193 1,025,542 1,228,982 100.0 100.0 100.0 
In per cent of exports to the world: 0.87% 1.17% 1.22%
HS 84 Machinery, mechanical appliances 142,346 331,708 383,043 19.9 32.3 31.2 
HS 30 Pharmaceutical products 188,721 240,016 337,121 26.4 23.4 27.4 
HS 29 Organic chemicals 99,094 106,304 111,011 13.9 10.4 9.0 
HS 33 Pefumery, cosmetics 22,763 44,515 52,542 3.2 4.3 4.3 HS 91 Clocks and watches 29,905 39,091 51,200 4.2 3.8 4.2 
HS 32 Tanning, dye, paints, putty, inks 30,499 34,686 42,248 4.3 3.4 3.4 
HS 54 Manmade filaments 24,348 26,678 33,843 3.4 2.6 2.8 
HS 90 Optical, medical, surgical instruments 26,996 32,025 33,719 3.8 3.1 2.7 
HS 85 Electrical machinery 31,377 29,119 32,185 4.4 2.8 2.6 
HS 39 Plastic, plastic articles 16,045 19,808 23,536 2.2 1.9 1.9 WT/REG86/R/B/3 
G/L/686 Page 6 
 
 
EFTA States' trade with Turkey 1992-2003
(in million US dollars)
0.0200.0400.0600.0800.01,000.01,200.01,400.01,600.01,800.0
19921993 199419951996 19971998
199920002001
20022003Imports
Exports WT/REG86/R/B/3 
 G/L/686 
 Page 7 
 
 
2000 2001 2002 2003 2001/00 2002/01 2003/02
                  In thousand US dollars    Percentage change
IMPORTS
Iceland 2,380,087 2,092,181 2,092,382 2,602,960 -12.1 0.0 24.4
Norway 34,358,138 30,966,144 33,784,177 39,333,937 -9.9 9.1 16.4
Switzerland 82,411,758 84,065,116 83,772,085 96,534,778 2.0 -0.3 15.2
EFTA 119,149,983 117,123,441 119,648,644 138,471,675 -1.7 2.2 15.7
Share in EFTA's tot. imports 100.00% 100.00% 100.00% 100.00%
EXPORTS
Iceland 1,889,770 2,013,680 2,217,368 2,377,900 6.6 10.1 7.2
Norway 59,842,081 57,347,896 60,537,467 67,267,861 -4.2 5.6 11.1
Switzerland 80,402,473 82,056,608 87,966,583 100,772,824 2.1 7.2 14.6
EFTA 142,134,324 141,418,184 150,721,418 170,418,585 -0.5 6.6 13.1
Share in EFTA's tot. exports 100.00% 100.00% 100.00% 100.00%
IMPORTS + EXPORTS
Iceland 4,269,857 4,105,861 4,309,750 4,980,860 -3.8 5.0 15.6
Norway 94,200,219 88,314,040 94,321,644 106,601,798 -6.2 6.8 13.0
Switzerland 162,814,231 166,121,724 171,738,668 197,307,602 2.0 3.4 14.9
EFTA 261,284,307 258,541,625 270,370,062 308,890,260 -1.0 4.6 14.2
Share in EFTA's total trade 100.00% 100.00% 100.00% 100.00%
-- no percentage calculated
Source: World Trade AtlasEFTA STATES' TRADE WITH THE WORLD
2,602.96 2377.9039,33467,26896,535 100,773
020,00040,00060,00080,000100,000120,000
Iceland Norway SwitzerlandEFTA States' trade with the World
(2003 - million US dollars)
Imports
ExportsWT/REG86/R/B/3 
G/L/686 Page 8 
 
 
EFTA STATES' TRADE WITH THE WORLD BY SELECTED COMMODITIES (HS)
Source: World Trade Atlas 2001 2002 2003 2001 2002 2003 
IMPORTS In thousand US dollars In per cent
Iceland
Total imports from the World 2,092,181 2,092,382 2,602,960 100.0 100.0 100.0 
In per cent of imports from the world 100.00% 100.00% 100.00%
HS 84 Machinery, mechanical appliances 241,171 226,383 355,790 11.5 10.8 13.7 
HS 85 Electrical machinery 225,576 211,312 272,467 10.8 10.1 10.5 
HS 87 Vehicles (not railway) 129,303 127,670 263,108 6.2 6.1 10.1 
Norway
Total imports from the World 30,966,144 33,784,177 39,333,937 100.0 100.0 100.0 
In per cent of imports from the world 100.00% 100.00% 100.00%
HS 84 Machinery, mechanical appliances 4,910,813 5,382,095 6,086,575 15.9 15.9 15.5 
HS 87 Vehicles (not railway) 2,953,253 3,384,822 4,026,657 9.5 10.0 10.2 
HS 85 Electrical machinery 3,314,639 3,347,591 3,801,190 10.7 9.9 9.7 
HS 27 Mineral fuels, oil 1,166,933 1,091,082 1,566,882 3.8 3.2 4.0 
HS 73 Iron and steel products 990,962 1,232,676 1,504,804 3.2 3.6 3.8 HS 94 Furniture and bedding 955,562 1,122,033 1,311,102 3.1 3.3 3.3 
HS 39 Plastic, plastic articles 997,078 1,069,605 1,278,175 3.2 3.2 3.2 
HS 90 Optical, medical, surgical instruments 927,483 1,072,722 1,237,259 3.0 3.2 3.1 
Switzerland
Total imports from the World 84,065,116 83,772,085 96,534,778 100.0 100.0 100.0 
In per cent of imports from the world 100.00% 100.00% 100.00%
HS 84 Machinery, mechanical appliances 10,689,668 10,471,631 11,828,530 12.7 12.5 12.3 
HS 30 Pharmaceutical products 5,985,529 7,020,717 8,244,485 7.1 8.4 8.5 
HS 85 Electrical machinery 7,533,517 6,871,841 8,012,061 9.0 8.2 8.3 
HS 87 Vehicles (not railway) 7,075,849 6,974,835 7,982,540 8.4 8.3 8.3 HS 29 Organic chemicals 5,198,157 5,907,663 6,847,698 6.2 7.1 7.1 
HS 71 Prescious stones and metals 7,254,837 5,247,713 4,914,935 8.6 6.3 5.1 
HS 27 Mineral fuels, oil 3,855,284 3,511,751 4,196,018 4.6 4.2 4.3 
HS 39 Plastic, plastic articles 2,823,840 2,965,716 3,604,104 3.4 3.5 3.7 
HS 90 Optical, medical, surgical instruments 2,780,386 2,952,648 3,323,256 3.3 3.5 3.4 HS 94 Furniture and bedding 1,937,399 2,064,485 2,397,673 2.3 2.5 2.5 
EXPORTS In thousand US dollars In per cent
Iceland
Total exports to the World 2,013,680 2,217,368 2,377,900 100.0 100.0 100.0 
In per cent of exports to the world: 100.00% 100.00% 100.00%  
HS 03 Fish, crustaceans 956,104 1,039,417 1,112,987 47.5 46.9 46.8 HS 76 Aluminium and articles thereof 415,710 427,226 451,233 20.6 19.3 19.0 
HS 16 Preparations of meat, fish 133,921 142,105 164,735 6.7 6.4 6.9 
Norway
Total exports to the World 57,347,896 60,537,467 67,267,861 100.0 100.0 100.0 
In per cent of exports to the world: 100.00% 100.00% 100.00%
HS 27 Mineral fuels, oil 36,110,921 38,010,105 41,957,455 63.0 62.8 62.4 
HS 03 Fish, crustaceans 3,143,044 3,314,795 3,436,486 5.5 5.5 5.1 
HS 76 Aluminium and articles thereof 2,623,036 2,438,389 3,042,517 4.6 4.0 4.5 
HS 84 Machinery, mechanical appliances 2,265,303 2,795,489 2,897,566 4.0 4.6 4.3 
HS 99 Salvage and reparations 2,577,947 2,338,711 2,720,251 4.5 3.9 4.0 HS 85 Electrical machinery 1,613,939 1,427,430 1,618,412 2.8 2.4 2.4 
HS 89 Ships, boats and floating structures 578,811 879,448 942,872 1.0 1.5 1.4 
HS 48 Paper, paperboard 777,153 741,744 828,806 1.4 1.2 1.2 
Switzerland
Total exports to the World 82,056,608 87,966,583 100,772,824 100.0 100.0 100.0 
In per cent of exports to the world: 100.00% 100.00% 100.00%
HS 84 Machinery, mechanical appliances 14,885,158 15,007,997 16,752,996 18.1 17.1 16.6 
HS 30 Pharmaceutical products 10,875,192 12,773,411 15,944,487 13.3 14.5 15.8 
HS 29 Organic chemicals 7,875,352 9,736,416 10,245,803 9.6 11.1 10.2 
HS 91 Clocks and watches 6,317,151 6,894,084 7,585,087 7.7 7.8 7.5 HS 85 Electrical machinery 7,440,827 6,484,421 7,442,343 9.1 7.4 7.4 
HS 90 Optical, medical, surgical instruments 5,115,105 5,876,242 7,329,168 6.2 6.7 7.3 
HS 71 Prescious stones and metals 4,890,017 5,071,698 4,841,060 6.0 5.8 4.8 
HS 39 Plastic, plastic articles 2,608,279 2,837,876 3,420,286 3.2 3.2 3.4 
HS 32 Tanning, dye, paints, putty, inks 1,762,341 1,869,460 2,094,405 2.1 2.1 2.1 
HS 48 Paper, paperboard 1,481,130 1,612,575 1,906,401 1.8 1.8 1.9  WT/REG86/R/B/3 
 G/L/686 
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__________ 
 
 EFTA's trade with the world 1992-2003
(in million US dollars)
020000400006000080000100000120000140000160000180000
199219931994
1995
199619971998
19992000200120022003Imports
Exports