The European Budget Post-2013 and its Effects on EU-Turkey Relations
employment, through nominal wage cuts. Both have left the people at a disadvantage. Consequently, the employment rate remains very low at 49% and even lower for women at 27%.7 Further, unemployment is persistently high at around 11%. At 24%,8 Turkish youth is particularly affected. This is especially so because only 15.5%9 of all Turkish youth have acquired a tertiary education. A high inflation rate of around 8%10 puts additional pressure on people. According to the OECD, 49% of the population find it difficult to live on their current income and 17% are considered relatively poor.11 This applies especially to people living and working in rural areas as the economic gap between urban and rural areas is very wide. In spite of structural challenges, the Turkish economy is expected to keep growing at high rates. According to forecasts by the International Monetary Fund (IMF), the Turkish GDP per capita is expected to reach 47.44% of the EU-27 level in 2016.12 Presuming a steady growth rate of 4% for Turkey and 2% for the EU beyond 2016, the Turkish economy would reach 51% of the EU-27 level in 2020. This equals the economic performance of Poland at the time of its accession in 2004. 1.3 EU-Turkey economic relations Apart from Turkey being an EU candidate country, it has been associated with the EU via a Customs Union agreement since 1995. This agreement covers all industrial goods but excludes public procurement, services, and unprocessed agricultural products. In addition, a free trade area was established in 1996 for all products covered by the European Coal and Steel Community. 7. European Commission, DG ECFIN. EU candidate and Pre-accession countries. Economic quarterly, April 2011. 8. European Commission, DG Trade 2011. 9. Eurostat. 10. European Commission, DG Trade Statistics, EU bilateral trade and trade with the world, 2011. 11. OECD (2011), Society at a Glance - OECD Social Indicators for Turkey. 12. IMF, World Economic Outlook Database, April 2011.
Published on Feb 16, 2012
A Publication based on the International Conference organised at the European Parliament/Brussels by Dr. ELENI THEOCHAROUS, Member of the Eu...