USA terminates Turkey`s preferential trade agreement, reduces tariffs on steel

"We're continuing to train the Turkish pilots at Luke Air Force Base but we don't think that we can deliver those aircraft into a country that has the S-400", Wilson said.

The US reduces tariffs on Turkish steel.

Turkey has welcomed the Trump administration's decision to halve tariffs on steel imports but urged the United States to stick to the bilateral trade volume target of $75 billion.

The TRY is down but not out in a sense that it is still trading well above the recent low of 6.2458 per US Dollar reached on May 9.

Trump's move had sent the Turkish lira into a tailspin.

However, Washington added that the tariffs on Turkey's steel exports would be diminished by 25 per cent.

The White House announced on Thursday that Turkey would be removed from the Generalised System of Preferences effective 17 May. In a subsequent statement on Thursday, the White House said it was reducing the 50% tariff, doubled last August, to 25 per cent.

The US Trade Representative (USTR) in early March said Turkey was no longer eligible to participate because it "is sufficiently economically developed".

It came amid heightened tensions which, in addition to a number of contentious points, have recently soured over Turkey's refusal to give up the purchase of Russian S-400 missile air-defense systems, which the USA apparently sees as a direct threat to its own national security and interests.

During that time, the United States and Turkey imposed reciprocal tariffs on a number of goods, including Turkish steel and aluminum.

His proclamation said that maintaining the 25 percent tariffs remains "necessary", however.

The annulment of preferences in mutual trade contradicts the targeted goal of the two countries to increase trade to $75 billion, according to Turkey's Minister of Commerce Ruhsar Pekcan. The United States imported $1.66 billion in 2017 from Turkey under the GSP program, representing 17.7 per cent of total US imports from Turkey, according to USTR's website.

The leading GSP import categories were vehicles and vehicle parts, jewelry and precious metals, and stone articles, the website said.

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