WORLD TRADE  
ORGANIZATION  WT/REG203/4 
14 April 2009 
 
 (09-1765) 
Committee on Regional Trade Agreements  Original:   English 
  
 
ASSOCIATION AGREEMENT BETWEEN TURKEY AND TUNISIA 
 
Questions and Replies
 
  
 The following communication, dated 14 April 2009 is being circulated at the request of the 
delegations of Turkey and Tunisia.   This document reproduces the questions addressed to the Parties and the responses submitted. 
 
_______________ 
 
 
Question from the Delegation of Chinese Taipei 
 
 Trade Environment
 
 
1. Could the parties provide more details about the trade expansion and economic benefits 
between Turkey and Tunisia after signing the Association Agreement? 
 Regarding bilateral trade between Turkey and Tunisia, the Parties witnessed a sharp increase 
in the trade volume. Until the entry into force of  the Agreement, the bilateral trade volume was 
realized between 350 and 450 million dollars with an  increase of 15% in average.  However, as of 
2007, the bilateral trade grew by 60% and reac hed 760 million dollars. Mo reover, in 2008, this 
number increased to 1.1 billion dollars with an incr ease of 50%.  In this sense, we clearly can see the 
fruitful and trade creative results of the FTA in our bilateral trade.   Moreover, regarding the economic activities between  the two countries, with the effect of the 
FTA and the positive investment environment in Tu nisia, the economic activities in the constructing 
sector have been increasing.  Five of seven total projects in Tunisia undertaken by Turkish 
constructing companies sector have been realized in the last two years.  The largest project among them is the construction of Tunisia Enfidha Airport which costs around 600 million dollars.   Furthermore, with the positive effect of the FTA  the interest of Turkish companies to Tunisia 
has been increasing, the number of fairs and missions  has reflected this interest.  Regarding national 
participation to fairs, while Turkish companies did not participate to any fairs in Tunisia until 2006, 
between the years 2006 and 2008, they participated to 8 fairs.  In addition, regarding individual 
participations, after 2006, there has been a significant  increase in the individual participation to the 
fairs in Tunisia.  In 2005, while the number of par ticipation to fairs in Tunisia was recorded as three, 
in 2006, this number has reached 15. In 2007 and 20 08, the number of participation was realized as 
10 for each year.  On the other hand, as for Buye rs’ missions, in 2005 and 2006, while the number of 
missions from Tunisia participating to the fairs or other trade-related organizations was realized as 
one, in 2007 this number has increased to 16 and in 2008, it reached 14.  WT/REG203/4 
Page 2  
 
   As it can be seen clearly from the figures, th ere is a positive effect of the FTA in trade 
between the Parties.  The positive effect of the FTA not  only is reflected to the trade figure, but also to 
the other trade-related areas, such as contracti ng sector, fairs and trade-related organizations.  
 Questions from the Delegation of Japan
 
 Government Procurement
 
 2. With respect to Paragraph 51, Section III.D.5(b) of the Factual Presentation 
(WT/REG203/3), could the Parties inform us of the threshold and institutions of the “public 
contracts” which will be open to th e companies in the other Parties?  
 Turkey and Tunisia do not make any bila teral commitment and give any preferential 
treatment regarding public procurement within th e framework of the Association Agreement between 
Turkey and Tunisia.  In this regard, Article 29 of the Agreement including the provision “The opening 
up of the award of public contracts on the basis of non-discrimination, transparency and reciprocity is 
set as a desirable objective to consider between th e Parties” is beyond doubt.  Within this framework, 
both Parties will facilitate the access of n ecessary information on public procurement. 
 
Institutional Framework and Dispute Settlement
 
3. With respect to Paragraph 58 and 60, Sectio n IV.C.3 and Section IV.C.4, could the 
Parties inform us of the development under “Association Committee”?  What were the 
discussions about at the past Association Committ ee?  Is there any Dispute Settlement related 
discussion at the past Association Committee?   
 The first meeting of Turkey-Tunisia Association Council was held on 16-17 December 2008 
in Ankara.  During this meeting, issues on commercial activities, new opportunities and ways to 
enhance bilateral commercial and ec onomic relations were discussed.  On the other hand, no issues 
related with the Dispute Settlement were broug ht up to the agenda by the Parties.  
 
Questions from the Delegation of the United States  
 
Goods liberalization   
 4. According to Paragraphs 17 and 18 and Annex 1 of the Factual Presentation 
(Tables AI.1-AI.2):  
 Turkey
 eliminates duties on 83.4% of all tariff lines covering 99.2% of imports from 
Tunisia under the agreement.  However, though 96.8% of industrial tariffs are duty-free, only 
18.7% of agricultural tariff lines are duty-free under the agreement.    Tunisia
 eliminates duties on 76.5% of all tariff lines covering 96.5% of imports from 
Turkey under the agreement.  However, though 95. 2% of industrial tariffs are duty-free, only 
3.3% of agricultural tariff lines are duty-free under the agreement.  
 
(a) How do the Parties explain the extrem ely disproportionate liberalization 
between the industrial and agricultural sectors?  
 Regarding bilateral trade between Turkey an d Tunisia, the trade composition between the 
Parties is also disproportionate. Between 2002 and 2008, the agricultu ral products and the industrial 
products consist of approximately 5% and 95% of th e total bilateral trade respectively. Taking into  WT/REG203/4 
 Page 3 
 
 
  account their sensitivity of the agricultural sector and its  small share in total bilateral trade, the Parties 
preferred to liberalize mainly their industrial sector.    On the other hand, the Association Agreem ent envisages a gradual establishment of a free 
trade area on substantially all their trade between th e Parties in a transitional period of nine years 
starting from the entry into force of the Agreem ent in conformity with Article XXIV of the 
GATT 1994.  Turkey abolished the customs tariffs on a ll industrial products originating in Tunisia on 
the date of entry into force of the Agreemen t and the Parties exchanged concession on selected 
agricultural products as an initial liberalization process.  
 Moreover, it is also stated in Article 12 of th e Agreement that taking into account the role of 
agriculture in their respective economies; the deve lopment of trade in agricultural products between 
the Parties; the high sensitivity of agricultural pr oducts; the rules of thei r respective agricultural 
policies, the Parties will examine in the Associ ation Committee the possibilities of granting to each 
other further concessions in trade in agricultural prod ucts.  Moreover, it is also possible to extend the 
Agreement if one of the Party considers that it would be useful and in the interest of the economies of 
the Parties to develop the relations.  In that sense, progressive liberalization for the agricultural 
products in the future will be provided.  
(b) Please explain in detail the reasons why both Parties virtually excluded their 
entire agricultural sector from tariff elimination under this agreement?  
 With respect to all industrial products the Par ties agreed on full tariff elimination, though with 
differing time schedules. As for the agricultural prod ucts, the Parties agreed to exchange concessions 
on selected products within the modalities indicated in the Table A and B to Protocol II of the Association Agreement between Turkey and Tunisia.  
 
 With respect to the role of the agricultura l sector in the economies of the Parties, their 
respective agricultural policies and particularly the sensitivity of the agricultural products, the Parties 
have preferred to exchange market  access opportunities at a modest a pproach rather than an ambitious 
form of tariff elimination.  
 
 Still, in accordance with the Article 12 of the FTA and the Article 5 of the Protocol II, the 
Parties are willing to establish a prog ressive liberalization of their trade in agricultural products which 
are of interest to both Parties. In this further lib eralization for agricultural products, the Parties will 
take into account the development of agricultura l trade, their agricultural policies and their 
sensitivities for the respective agricultural products.  
(c) The fact that the term “substantially a ll trade” has not been further clarified 
does not change the fact that Members are under an obligation to cover “substantially all trade” if they want the cover of GATT Article XXIV.   The 
United States assumes that the Parties have their own understanding of what 
“substantially all trade” is because they are required to make sure they meet this 
standard of coverage.   
- In this light, we ask that the Parties please explain their understanding of 
the term “substantially all trade.”  
- Could the Parties please explain how their tariff elimination 
commitments achieve the “substantially  all trade” standard set out in 
GATT Article XXIV? WT/REG203/4 
Page 4  
 
   The expression of “substantially all trade” does not include any specific meaning peculiar to 
the Association Agreement between Turkey and Tunisi a. Turkey and Tunisia enter an exact obligation 
in order to establish a free trade area in conformity with the Article XXIV of GATT 94.    This expression, clearly, envisages, according to GATT XXIV:8, the elimination of barriers 
which affects the substantially all trade and answer s the needs of the reciprocal implementation which 
could vary in a broad context with rega rd to the needs of the various sectors. 
  In this sense, the Association Agreement be tween Turkey and Tunisia envisages a gradual 
establishment of a free trade area on substantially all their trade in a transitional period of nine years 
starting from the entry into force of this Agreement in conformity with Article XXIV of the 
GATT 1994.  In this regard, the Association Agreem ent covers the liberalization of approximately 
95% of total bilateral trade.  The Agreement envisag es liberalization of bilateral trade by abolition of 
customs tariffs on non-agricultural products and by exchanging of concession (tariff-quota and 
customs exemption. etc.).  Furthermore, in the Agreement, the Parties ag reed to consider the 
possibilities of granting to each other further concessions  in trade in agricultural products taking into 
account the role of agriculture in their respective economies, the development of trade in agricultural 
products between the Parties, the high sensitivity of agricultural products and the rules of their 
respective agricultural policies. 
5. Please explain why products that may, at this  point, have no bilateral trade associated 
with them are not subject to full tariff elimination.  
 The products which are not subject to full tariff elimination are mainly the agricultural 
products and the products which are subject to fu ll tariff elimination are the industrial products 
because the Parties mainly trade industrial products, the we ight of which in bilateral trade is 95%.  In  
this respect, Parties prefer tariff elimination on in dustrial products.  While Turkey abolished all the 
tariffs on imports to the industrial products originating in Tunisia with the entry into force of the 
agreement on products, Tunisia eliminates the cust oms duties on imports to the industrial products 
originating in Turkey gradually.   As for the agricultural products, the Parti es agreed to exchange concessions on selected 
products.  However, taking into consideration the sensitivity of the agricultural products and the 
interests of both Parties, the Parties have pref erred to exchange market access opportunities at a 
modest approach rather than an ambitious form of tariff elimination. 
 
6. Please provide the average duty rate by HS Ch apter for the lines that remain dutiable.  
Chapter Average Duty Rates (%) 
Chapter 1 54,2 
Chapter 2 138,1 
Chapter 3 29,8 
Chapter 4 96,8 
Chapter 5 3,5 
Chapter 6 18,1 
Chapter 7 20,5 
Chapter 8 41,6 
Chapter 9 38,6 
Chapter 10 41,0 
Chapter 11 39,7 
Chapter 12 16,6 
 Table (cont'd) WT/REG203/4 
 Page 5 
 
 
  Chapter Average Duty Rates (%) 
Chapter 13 1,5 
Chapter 14 0,0 
Chapter 15 19,0 
Chapter 16 101,1 
Chapter 17 73,2 
Chapter 18 8,4 
Chapter 19 8,5 
Chapter 20 54,4 
Chapter 21 11,5 
Chapter 22 36,9 
Chapter 23 7,7 
Chapter 24 23,5 
 
7. According to Paragraph 15 and the corresponding  footnotes, the Parties agreed to hold 
consultations within a year following entry in to force (July 2005) on improving the bilateral 
exchange of preferences for agricultural produc ts. However, as of July 2008, no further 
concessions in agricultural products have been granted.  
(a) Do the Parties intend to eliminate tariffs  on additional agricultural products 
under the agreement in the future? If so, when? 
 Article 5 of Protocol II of the Association Ag reement, setting the exchange of the concessions 
in agricultural products, states that the Parties, w ithin a year following the entry into force of the 
Agreement, shall make consultations within th e Association Committee with a view to further 
improve the bilateral exchange of pr eferences for agricultural products.  
  The mentioned Article of the Protocol II is a clear indication of the Parties’ intention to 
further improve the agricultural concessions. Accord ingly, in the first meeting of the Association 
Committee, held on 16-17 December 2008 in Ankara, the Parties had consultations;  however, due to 
the high sensitivity and the social aspects of the ag ricultural sector, an improvement of the preferences 
for agricultural products has not been achieved yet.  Still, the Parties shall declared their mutual 
determination to intensify their efforts with the aim of further development of trade in agricultural and 
processed agricultural products between the countries.  Therefore, it is expected that Parties will 
initiate the relevant process in the follow ing meeting of the Association Committee. 
 
Sanitary and phytosanitary measures
  
 8. We are concerned that Article 13 on Sanita ry and Phytosanitary Measures, summarized 
in paragraph 40 of the Factual Presentation , makes no specific reference to the WTO 
Agreement on the Application of Sanitary a nd Phytosanitary Measures (SPS Agreement).   
(a) Could the Parties please explain which WTO agreements would be considered 
relevant under Article 13?  Are there agreements other than the SPS Agreement that the Parties would consider relevant?   
 The Agreements which are considered as re levant under Article 13 of the Association 
Agreement between Turkey and Tunisia are the Agreement on Agriculture and the WTO Agreement 
on the Application of Sanitary and Phytosanitary Measures.    WT/REG203/4 
Page 6  
 
  9. We appreciate the commitment by the Parties to "not apply their [SPS measures] as an 
arbitrary or unjustifiable discrimination or a disguised restriction on trade.” However, we note that there are additional principles that are fundamental to the WTO SPS Agreement, such as 
scientific risk assessment, transparency, harmoniz ation, to name a few.  Could the Parties 
explain how these principles are upheld by the Association Agreement?  
 Article 13 of the Agreement clearly states that  the Parties shall apply their sanitary measures 
within the rules and procedures of the GATT 1994  and the other relevant WTO agreements. As 
explained above, the Agreements that are considered  relevant by the Parties are the Agreement on 
Agriculture and the WTO Agreement on the Applica tion of Sanitary and Phytosanitary Measures. 
Therefore, all the principles that are involved in the mentioned agre ements are deemed applicable in 
their SPS measures by the Parties. 
 
__________