SINGAPORE: The Turkey-Singapore Free Trade Agreement (TRSFTA) will come into force on Oct 1 after it was ratified on Monday (Aug 21), announced Singapore Prime Minister Lee Hsien Loong and Turkish Prime Minister Binali Yildirim at a joint press conference at the Istana.
The FTA was signed back in November 2015.
“Singapore and Turkey are gateways to our respective regions. We both benefit from open and free trade. Our bilateral trade have grown steadily and has exceeded S$1 billion in the last decade," said Mr Lee.
"This free trade agreement is another significant milestone in our relationship. It will send a strong signal to our business communities and strengthen our economic ties.”
According to the Ministry of Trade and Industry (MTI), the TRSFTA will reduce barriers to trade and investment between both countries, enhance access to services sectors and procurement markets, as well as promote greater connectivity between businesses and people.
It will also help more Singapore companies to leverage Turkey’s location as a gateway to the larger regional markets in Europe, Central Asia, the Middle East and Africa.
“Within the last decade, our bilateral trade has been on the rise," said Mr Yildirim. "But I believe with the recently ratified FTA, we will see further improvement of these figures. There is a high potential for us to foster our cooperation between our two countries.”
At the conference, both parties also noted that there has been significant progress since they signed a Strategic Partnership in October 2014. The ratification of the TRSFTA builds upon the partnership signed between Mr Lee and Turkey’s then-Prime Minister Ahmet Davutoğlu, they said.
Mr Lee said relations have broadened in areas such as defence, counter-terrorism, culture, technical training, as well as science and research cooperation. He added that Singapore had welcomed and supported Turkey recently becoming a sectoral dialogue partner of Association of Southeast Asian Nations (ASEAN), as it will encourage the country to engage actively with the region.
Mr Yildirim has said Turkey sees Singapore as its main partner in its opening into the ASEAN region and beyond.
“We attach great importance to the development of our relations with ASEAN, a leading regional organisation ... Our trade with ASEAN countries has increased six-fold over the past 14 years, reaching US$8.7 billion (S$11.8 billion) at the end of 2016.”
Mr Yildirim is in Singapore for a three-day official visit. On Monday morning, he visited the Botanic Gardens where an orchid was named in his honour. He also called on President Tony Tan Keng Yam at the Istana.
He also visited PSA's port facilities, accompanied by Minister for Industry S Iswaran, before his departure to Hanoi, Vietnam on Tuesday.
The port operator is one of a few Singapore companies that already have a presence in Turkey. It is working with Akfen Holding and IFM Investors to manage and develop Turkey's Mersin International Port (MIP).
SINGAPORE COMPANIES CAN USE TURKEY AS BASE TO EXPAND INTO EUROPE: ISWARAN
Separately, Mr Iswaran said Singapore companies can tap on Turkey's location as a gateway to larger regional markets in Europe, Central Asia, the Middle East and Africa.
“Turkey represents a large, dynamic market for Singapore businesses, with a population of 80 million and a GDP of nearly US$860 billion in 2016. Turkey is a successful regional hub for manufacturing and other business activities," he said at the Turkey-Singapore Business Forum.
“At the government level, Turkey and Singapore are working closely together to create conducive conditions for our businesses to grow. Both governments have put in place frameworks to promote trade and investment relations between our countries.”
With the FTA, tariffs for Singapore's exports to Turkey on 80 per cent of all tariff lines will be eliminated from Oct 1. This will increase to more than 95 per cent of all tariff lines over a period of 10 years.
Mr Iswaran said both countries have prioritised development in infrastructure, healthcare, fintech and e-commerce, adding that other key benefits of the TRSFTA included the ability to bid for government procurement contracts.
In 2015, Turkish direct investment in Singapore was S$135 million, while Singapore’s direct investment in Turkey amounted to S$218 million, according to MTI.
Mr David Yang, co-chair of the Turkey-Singapore Business Council said: "Singapore and Turkey will commit to granting better access to each other's services markets, including areas such as retail services, business services, and construction services."