The Modernization of Turkey’s Customs Union with the European Union: Reasons and Possible Outcomes

Abstract:

This paper seeks to explain why, in May 2015, the European Union (EU) and Turkey have chosen to modernize their Customs Union instead of directly completing Turkey’s accession process, how they will most likely do so, and the implications thereof for Turkish EU membership.

I argue that Turkey and the EU seek to modernize the Customs Union because of the EU’s increased quest for bilateral free trade agreements after the failure to conclude the Doha Development Round, the flawed implementation of the institutional provisions of the 1963 Ankara Agreement, and the stalemate in EU accession negotiations. The Customs Union is likely to be modernized by liberalizing agriculture, services and public procurement and by improving the implementation of the 1963 Ankara Agreement. The modernized Customs Union will most probably be the institutional basis for EU-Turkey relations in the near future. However, in a better future conjuncture of bilateral relations, it may then serve as a further step for Turkey’s accession to the EU.