On December 8, 2015, The German Marshall Fund of the United States (GMF) together with the Turkish Industry and Business Association (TÜSİAD) hosted a discussion on the future of trade relations between Turkey and the European Union. The discussion, which was conducted under the Chatham House rule, was prompted by the launch of a joint report of TÜSİAD and the British Embassy in Ankara titled “A New Era for the Customs Union & The Business World”. Dr. Ian Lesser, senior director of Foreign and Security Policy at GMF moderated the panel which featured Pelin Yenigün Dilek, associate at Istanbul Economics, Simone Kaslowski, member of the board of directors & chairperson of the Global Relations and the EU Committee of TUSIAD, Simon Mordue, director for Strategy and Turkey at the Directorate-General for Neighbourhood and Enlargement Negotiations of the European Commission, and Luisa Santos, director for International Relations at BUSINESSEUROPE. Representatives from governments, EU institutions, and the private sector attended and contributed to the debate.

The panelists discussed strategies to reform and reenergize the Customs Union in order to deepen trade relations between the two partners and to adjust rules to changing realities in both markets, such as the growing importance of services. Other items of contention that were mentioned include public procurement, state aid, agricultural products, as well as asymmetry in market access.

In order to modernize the Customs Union, Turkish industries would need greater transparency from the European Union in order to create a stable and predictable market for investors. This is particularly the case in finding ways to anticipate how other bilateral trade agreements negotiated by the EU, in particular, the Transatlantic Trade and Investment Partnership (TTIP), could affect Turkey-EU trade relations in the future. Ultimately, the Customs Union should help set the standards that could prepare Turkey to be involved in a creative way as a third party in frameworks like TTIP. While the Customs Union should be understood as a mere supplement and stepping stone toward the eventual goal of Turkey’s EU membership, accession should not be used as a bargaining chip to solve current crises that both Turkey and the EU are facing, especially the refugee crisis.