Turkey has won its customs union struggle with the European Union, which decided not to exclude Turkey from the Transatlantic Trade and Investment Partnership (TTIP) it's about to conclude with the United States. The customs union agreement between the EU and Turkey is scheduled to be signed May 11.

Prime Minister Ahmet Davutoglu announced the development in his address to the General Assembly of the Union of Chambers and Bourses of Turkey on May 2. Davutoglu emphasized that henceforth there will be no infringement of Turkey’s rights in future EU free trade agreements. 

Turkey was excluded from the TTIP negotiations that began between the United States and the EU in 2013 because it was not an EU member. The risk of being kept out of the planned accord that would provide economic integration with the world’s largest free trade market of 800 million people brought Turkey to the verge of leaving the customs union.

The TTIP will remove all customs barriers between the United States and the EU. But as Turkey had already made a customs union agreement with the EU in 1996, the TTIP would have burdened Turkey with a tremendous disadvantage. Once the TTIP went into effect, Turkey would not impose a customs duty on imports from the United States, but the United States would continue such fees on imports from Turkey, costing Turkey considerable tax revenue. Moreover, its industry would be threatened by duty free imports; industries would shut down, production would decline and unemployment and the deficit would rise.