THE EFFECT OF TRADE AGREEMENTS: THE CASE OF INTERNATIONAL TRADE OF EUROPE AND TURKEY

Abstract

Buying and selling of goods and capital across nations and territories is known as international trade. Also trade and trade management has been an important task for countries over centuries. Great imperial powers managed to benefit from the commercial agreements with the neighboring countries or the other world powers as the international trade was considered the backbone of the world trade in the past and in modern world. Countries wanted to trade and have profit over the borders rather than the domestic limited markets, buying and selling required international agreement to be able to have access to a particular market of a particular country.

This paper attempts to introduce to trade agreements by the European powers and Turkey. The Ottoman Empire and the Great Britain created and signed a trade agreement on increasing international trade in the 19th century. And about a century later was another agreement signed by the European Union (EU) and Turkey.

European trade and merchants expanded in the Ottoman territories after 1770s especially after the Kucukkaynarca Agreement. It brought some social changes but more the economic changes and effected the Ottoman Empire socially and economically as different religious and ethnical groups occurred.

The international cooperation with the foreign merchants and competition among Muslim and non Muslim traders and even in between the non Muslim traders existed over centuries. But particularly, during the 19th century after having number of commercial agreement with European powers the competition increased in domestic market and internationally. And with the agreement of 1838, the agreement with the Great Britain made the foreign power beneficiary of the Ottoman trade as the foreign trade went under their control and non Muslim merchants were the intermediaries that served for the best interest of the European powers.

Turkey signed a Custom Union (CU) in between the EU member countries in 1994. The Commercial Agreement of 1838 and CU were for the same purposes that were to increase the trade in between Europe and Turkey. These two agreements aimed an increased in the trade relations and also trade volume and gain new markets for the national goods and also capital.

The purpose of the paper is to introduce the effects of the trade agreements for developing the international trade. The Agreement of 1838 signed by the Ottoman Empire and the Great Britain allowed more and more foreign goods into the Ottoman market and it brought new opportunities to the intermediaries of the Ottoman Empire. Also the CU signed with the EU brought more trade options to both sides. As trade quotas’ and tariffs decreased on both sided, the international trade increased with the union.

Methods used in the paper are the analysis of scientific literature, national archive for the data and the content analysis. It is expected that the trade relation in between two countries and as well as with the major European countries increased due to the agreement. With the agreement, the Ottoman Empire decreased the trade tariffs which resulted an increase in the foreign trade into the Ottoman territories. On the contrary, the CU was more beneficial as it aimed to increased trade and entry of goods into the domestic markets mutually.

DOI: http://dx.doi.org/10.5755/j01.em.17.4.3038