By Bahattin Gonultas & Diyar Guldogan

ANKARA

 The European Union and Turkey agreed to accelerate the process of updating Customs Union, Economy Minister of Turkey, Nihat Zeybekci said on Friday.

"The agreement has been in force longer than anticipated and there are systematic problems with it," Zeybekci said. 

Zeybekci said that the EU and Turkey agreed in March of this year on a road map, which is required to establish a framework for the negotations. 

Zeybekci said the negotiations on the joint report will be completed at the end of May 2015. 

The Economy Minister added that the shape of a new Customs Union Agreement, including a solution to "the systematic problems" and a formula to include Turkey in the Transatlantic Trade and Investment Partnership, will be ready in first half of 2016.

Commenting on the joint report, Zeybekci said that it will involve reviewing problematic aspects of the Customs Union, and developing the scope of the existing relations with the EU, negotiating reciprocal market access for services, public procurement and agricultural products.

Speaking at the Turkey-European Union 76th Joint Parliamentary Commission on Thursday, Turkey's EU Minister Volkan Bozkir said: "We wish to expand the Customs Union with agriculture, service sector and public procurement. We will start the restructuring negotiations at the end of this year. Thus, a trade volume of $300 billion will be reached."

Touching upon the TTIP, Bozkir said Turkey will soon attend the meetings of where the TTIP planning is made. "Therefore, we will have created a new platform here."

Noting the Customs Union is important for Turkey, Bozkir said "It is important to take part in these meetings to find a remedy for our TTIP problem."

Last year, Zeybekci warned many times that it would be "unsustainable," if Turkey is not included in the TTIP negotiations. “Turkey is the only non-EU country which has a Customs Union Agreement that came into force on 31 December, 1995, and is far from responding to the needs of today. It was unacceptable in terms of unfair competition after the EU signed a free trade agreement with third countries. It is not something that is acceptable for Turkey. Turkey should be included in the scope of the new TTIP agreement."

Turkish officials argue that future free trade agreements signed by the EU with other countries, such as the U.S., would effectively open Turkey’s market to exports from these states because Ankara is a signatory of the Customs Union Agreement.

But, at the same time, it would also effectively block Turkish exports from benefiting from tax advantages in those same states, should Ankara not be a party to the free trade deals negotiated by the EU, officials pointed out.

Last year, the World Bank’s Turkey director Martin Raiser  said that Turkey needs to take part in parallel negotiations with the U.S. in order to prevent adverse effects from the Transatlantic Trade and Investment Partnership.

“Turkey’s diplomatic efforts should be concentrated on making sure that the TTIP remains an open agreement available for countries such as Turkey,” said Raiser.

"Turkey has withstood the competitive pressures coming from low-cost third-party countries, without much funding from the EU," Arzuhan Dogan Yalcındag, former chairwoman of the Turkish Industrialists' and Businessmen's Association said late last year. "If Turkey is not included in the Transatlantic Trade and Investment Partnership process, we fear our interests would be harmed," she added.

If Turkey is not included in the Transatlantic Partnership, the economic cost for Turkey could reach $20 billion and 95,000 jobs, the Brookings Institute said in a recent report.

Turkey's exports to the EU stood at $68.5 billion and its imports from the bloc at $88.7 billion in 2014.