Turkey, US trade ties changed, Turkey no longer in the preference list

19 May 2019

Turkey, US trade ties changed, Turkey no longer in the preference list

The United States decided on 18th May that Turkey will be taken out of the GSP (Generalised System of Preferences) program. Under this program, some goods can enter a country without paying any tax (duty).

When some goods can enter a country without paying tax, it helps the exporting country (the country that is selling the things), because it makes their things cheaper. Because they are cheaper, they are easier to sell! But when the same country has to pay taxes, then the total cost of the thing is higher.
 	Turkey was given this concession (special treatment) in 1975. 120 countries benefit from the GSP program. They are able to sell their products at lower prices to American businesses.
 	What is notable is that the US also reduced the duty (tax paid to import things from another country) on Turkey’s steel to 25%. It was 50% earlier. So Turkey will find it easier to sell steel to the US industry.

India also benefits from the GSP program. However, we are under notice by the US, and a decision may be taken right after the general election results are announced on 23rd May 2019.

Read our earlier piece on US and India’s Preferential Trade Treatment going through changes

And very recently we read about the changes in the US and China trade terms the US and China fail to arrive at an agreement on trade

Credit: TCP

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