Turkey's Response to Syria's Drastic Import Tariffs
On January 11, 2025, Syria's newly established government imposed severe import tariffs on Turkish goods, raising them by as much as 300%. This move has triggered concerns in Turkey, especially as it directly impacts key industries like steel, cement, and wheat—sectors that make up the bulk of Turkey’s exports to Syria. The decision comes amidst ongoing efforts by Syria to stabilize and rebuild its economy after years of conflict, and it has sparked urgent discussions between the two nations.
Impact of Tariff Increase on Trade Dynamics
In 2024, Turkey’s total exports to Syria were valued at US$2.2 billion, with steel, cement, and wheat being the primary commodities. Among these, steel, specifically rebar, has seen a significant increase. From January to November 2024, Turkish rebar exports to Syria rose by 37% year on year, reaching a total of 124,500 metric tons. Turkish steel mills had high expectations for Syria's post-conflict reconstruction, which was anticipated to further drive steel demand, boosting exports and prices.
However, the new tariff structure threatens to undermine these projections. With tariffs on Turkish products now reaching up to 300%, the cost of doing business in Syria for Turkish exporters is expected to rise drastically, potentially stifling future growth in this important market. This has left Turkish businesses and the government seeking ways to mitigate the impact of these tariffs.
Ongoing Negotiations and Diplomatic Efforts
In response to the tariff increase, Turkish officials have engaged in immediate negotiations with their Syrian counterparts. The goal of these talks is to address the trade imbalance, re-evaluate tariff structures, and promote a mutually beneficial economic relationship. Both countries have indicated a desire to continue discussions on trade, customs, and diplomatic matters, with a focus on eliminating the uncertainty caused by the new tariff measures.
Turkey is particularly concerned about the long-term effects of these tariffs on its steel industry, which has been one of the most dynamic contributors to exports in recent years. Turkish steel manufacturers are worried that the higher tariffs could reduce their market share in Syria and hamper the economic cooperation between the two countries, especially in the context of Syria’s reconstruction efforts.
Steel Industry Optimism Amid Challenges
Despite the recent tariff increase, Turkish steel mills remain optimistic about the potential for long-term growth in the Syrian market. The reconstruction of Syria, particularly its infrastructure and urban centers, is expected to require significant amounts of steel, which could drive demand for Turkish products once the tariff issue is resolved. However, Turkish steelmakers are also preparing for alternative strategies, including exploring new markets and diversifying their export destinations, should the tariff situation remain unresolved.
The Importance of Bilateral Trade Cooperation
The trade relations between Turkey and Syria have historically been important to both countries, with Syria being a key partner for Turkey's construction and manufacturing sectors. The tariff imposition has introduced a level of uncertainty that both nations are eager to resolve, recognizing that stronger economic ties are crucial for regional stability and growth.
Turkish officials are optimistic that the negotiations will lead to a favorable outcome, as both sides stand to benefit from stable trade relations. The removal or reduction of tariffs could not only enhance trade volumes but also pave the way for deeper cooperation in other areas such as energy, infrastructure, and technology.
