The Turkey-Chile Free Trade Agreement: Benefits and Impacts
The Turkey-Chile Free Trade Agreement (FTA) is a bilateral trade agreement signed between Turkey and Chile in November 2017. The FTA aims to improve trade relations and increase investment opportunities between the two countries. In this article, we will discuss the benefits and impacts of the Turkey-Chile FTA.
Benefits of the Turkey-Chile FTA
1. Tariff Elimination
Under the FTA, Turkey and Chile will eliminate tariffs on 98% of their traded goods. This means that importers and exporters will be able to save money on import duties and taxes, making it more affordable to trade with each other.
2. Increased Trade
With tariff elimination, the FTA is expected to increase bilateral trade between the two countries. Turkey and Chile have complementary economies, with Chile being a major producer of agricultural products, while Turkey is a major consumer of these products. The FTA is expected to create more trade opportunities in these sectors, as well as in other areas such as textiles, automotive, and electronics.
3. Investment Opportunities
The FTA is expected to increase investment opportunities for Turkish and Chilean businesses. With the elimination of tariffs, businesses will be able to import and export goods at a lower cost, making it more cost-effective to invest in each other`s markets. Additionally, the FTA includes provisions for the protection of intellectual property rights, which will provide security for investors.
Impacts of the Turkey-Chile FTA
1. Competition
With increased trade and investment, the FTA is expected to create more competition in both countries. Companies will need to work harder to stay competitive, which may lead to increased innovation and efficiency.
2. Job Creation
The FTA is expected to create new job opportunities in both countries, particularly in export-oriented sectors. However, there may also be job losses in industries that face increased competition from imports.
3. Environmental and Social Impacts
The FTA includes provisions for environmental and social issues, such as labor rights and environmental protection. However, these provisions may not be enforceable, and there may be unintended environmental and social impacts from increased trade and investment.
Conclusion
Overall, the Turkey-Chile Free Trade Agreement has the potential to bring significant benefits to both countries. With tariff elimination, increased trade and investment opportunities, and the potential for job creation, the FTA is a positive step towards closer economic ties between Turkey and Chile. However, it is important to monitor the impacts of the FTA on both the environment and society to ensure that any negative impacts are minimized.