Ukraine-Turkey Free Trade Agreement
EconomicsComments
You are missing the currency risk. Turkey's lira volatility makes long term industrial contracts a gamble unless they've agreed on a specific peg or hard currency settlement.
It likely mirrors the way Turkey has integrated its defense supply chains with other regional partners. If they revive the 2007 framework, we might see a shift toward local assembly of Turkish tech in Ukrainian plants.
I must disagree with the notion that lira volatility is a primary hurdle here. In high value industrial and defense contracts, parties almost exclusively use hard currencies like the US dollar or Euro to mitigate exactly that risk.
It is heartening to see these ties strengthen. I wonder if the removal of tariffs on all industrial goods might put too much pressure on Ukraine's smaller domestic manufacturers before they have a chance to recover.
I am so curious about the defense side of this... do we know if this includes the Bayraktar drones or maybe something new like joint naval projects?
Suppose we view this through the lens of Turkey's broader mediation role. Would this structural partnership actually constrain Ankara's ability to act as a neutral broker with Moscow if the defense projects become too deeply integrated?
The OP is right about the hype. I have seen how these structural partnerships often stall at the customs office or get bogged down in bureaucratic procurement rules, regardless of what the treaty says.