Business roundtable on trade relations between Slovakia, Turkey and the EU
Business roundtable on trade relations between Slovakia, Turkey and EU was organized on 8 October 2019 in Bratislava by Business Alliance of Slovakia (PAS) in cooperation with the Turkish business association TÜRKONFED with an intent to discuss the current benefits of the EU-Turkey Customs Union for Turkish and Slovak SMEs and the barriers and opportunities of mutual trade.
Selected representatives from the government, politics and business sector who are engaged in EU or foreign policy with a focus on Turkey, spoke at the meeting to share their views and experience about EU trade policy and current relations between Slovakia, Turkey and the EU in the context of the debate on the modernization of the Customs Union between the EU and Turkey with the business sector, government and media. The outputs of the roundtable and the views of entrepreneurs will form the basis for policy recommendations in the process updates of the Customs Union.
The event was opened by Rastislav Chovanec, State Secretary of the Ministry of Economy of the Slovak Republic, who stated that The Ministry of Economy of the Slovak Republic welcomes any initiative whose ambition is to improve bilateral relations between Slovakia and other countries. As an open economy, Slovakia needs and welcomes its partners not only among EU countries but also outside the EU. Turkey is an important destination for Slovakia not only in terms of trade, but also in terms of tourism, sports and exchange stays and activities etc. In the context of mutual trade and investment between Turkey and Slovakia there are some reserves and it will be beneficial if new partners are found on both sides to deepen the trade exchange. Turkey is one of the top 20 trading partners of the Slovak Republic – given the size of this country and its economy, there is a high potential for further growth. Finally, he expressed his belief that this roundtable meeting will also result in concrete agreements that will translate into numbers and growth in trade. The Ministry of Economy of the Slovak Republic is ready to show cooperation and support for these activities and help removing any obstacles.
H. E. Aslıgül Üğdül, Ambassador of the Republic of Turkey to the Slovak Republic, described the level of relations between Turkey and Slovakia as stable, although it did not reach its level of potential. Mutual trade of the Slovak Republic and Turkey reached €1.2 billion, which is the least of the V4 countries. However, a significant number is reached in the field of tourism – in 2015, 170,000 Slovaks travelled to Turkey, this year this number was 200,000.
In the panel discussion, it was said that Slovakia supports Turkey’s EU membership – both countries have excellent mutual relations and there are no controversial issues in this area. Turkey is the 13th largest economy in the world, while being the EU’s fifth largest trading partner. Trade with Slovakia in 2018 amounted to €1.2 billion but the potential is much higher. Areas with the greatest potential for mutual cooperation are energy, renewable energy, nuclear energy, production of electricity-generating equipment, production of agricultural equipment, sheet metal and components for the automotive, and digital industries. Tourism has a gigantic potential – Turkey is one of the top five holiday destinations for Slovaks.
The exchange of expertise and experience is essential to expand cooperation – it will bring a breath of fresh air and the basis for future growth. Language understanding and negotiation skills are of significant importance – Turks are very good negotiating partners, tough but fair. The size and openness of the market to trade and investment is also important – all of which makes Turkey attractive, but an underestimated partner – it would be good to seize opportunities. Similar events and activities are essential in this regard since, as it was stated in the discussion, up to 44% of Slovak SMEs have never exported and 37% of them have never even thought about it.
The common denominator of comments by individual business and public sector representatives was the experience gained from everyday practice – for example, the existence of prejudice (discrimination based on faith and religion) against Turkish entrepreneurs in Slovakia and the language barrier, but the most important issues were related to the functioning of the Customs Union, the free movement of goods and services, export and import, taxation of goods or simplification of customs procedures, including the elimination of unnecessary bureaucracy and intensification of the use of modern ICT (paper documentation in the era of digitization). The tariffs that protect European production are, according to many, not balanced. There was also mentioned a call to extend the Customs Union fully to agriculture and food.
Participants would welcome any common rules aimed at simplifying business, reducing tariffs, which would mean a reduction in the price of imported goods, removing many non-tariff barriers and administrative obligations, liberalization of visa policy to facilitate labour mobility and common rules in the field of public procurement. This would facilitate the mutual participation of firms in government contracts in Turkey and in EU Member States.
Concerning the areas with the greatest opportunities for the development of trade relations between Slovakia, Turkey, and the EU, the participants agreed on the following: outsourcing of software solutions, automotive industry, textile industry, gastronomy, R&D, innovation and data services.