Turkey doubles additional levies on US products

Wed 10/10/2018 by Richard Wilkinson
Turkey doubles additional levies on US products

On August 15, 2018, President Erdogan of Turkey introduced a second round of countermeasures on products of US origin. This doubles the additional levies that were implemented on June 25, 2018.  The additional tariffs relate to the same products from the June 25th decision, and include tree nuts, machinery and equipment. Turkey announced these measures in retaliation to the US imposition of steel and aluminium import tariffs. The latest decision to levy additional tariffs comes in response to the recent announcement of additional increased tariffs on Turkey’s steel and aluminum exports to the US.

The normal tariff on walnuts and almonds is 15% and on pistachios and pecans is 43.2%. With the additional levy, the new total tariff rate is expected to be 35 percent for walnuts and almonds and 63.2 percent for pecans and pistachios. On December 31, 2017, to combat food price inflation, rice tariffs were reduced until July 1, 2018, but are now back to rates of 34 percent for paddy rice, 36 percent for husked brown rice, and 45 percent for milled rice.

These additional tariffs imposed by Turkey on imported goods from the United States will make products more expensive in Turkey and thus contribute to Turkey’s food price inflation problem. A good portion of Turkey’s agricultural imports from the US are used as inputs in value-added products produced in Turkey and re-exported, supporting Turkey’s exports. Because of this, Turkey’s inward processing regime facilitates tariff-free imports of products which will be used as inputs for value-added exports. However, products from the US have recently been excluded from the inward processing regime.

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