The Maldives is poised to strengthen its economic ties with Türkiye through the signing of a Preferential Trade Agreement (PTA) within the next few months, according to Economic Minister Mohamed Saeed. The announcement was made during an appearance on Public Service Media (PSM) on Saturday evening, signalling a significant development in trade relations between the two nations.
A Preferential Trade Agreement, or PTA, is a trading bloc that offers preferential access to certain products from participating countries by reducing tariffs, although not completely eliminating them. The arrangement aims to enhance trade by making products more competitively priced in the markets of partner countries.
Minister Saeed disclosed that the Maldivian government had finalised the PTA with Türkiye last Thursday. The agreement is now set to be sent to the Turkish parliament, the Grand National Assembly of Türkiye, for approval. Once it receives parliamentary approval, the PTA will be signed by both countries. Saeed indicated that the agreement is expected to come into effect around December or by 1st January.
Benefits for the Maldivian Economy
The PTA will cover a total of 214 items, providing a framework for reduced tariffs on a range of goods traded between the Maldives and Türkiye. Notably, the Maldivian government has secured zero tariffs on 38 key items, including yellowfin tuna, skipjack tuna, dried fish, and other fish products. As Türkiye is one of the world’s leading processors of fish, including those caught in European waters, this agreement presents a strategic advantage for the Maldives, potentially opening up the Turkish market for its fish exports.
Strengthening Bilateral Relations
The finalisation of the PTA follows a series of discussions between the Maldives and Türkiye that took place in April this year. The new Maldivian administration under President Dr Mohamed Muizzu has been actively fostering closer ties with Türkiye, evident from President Muizzu’s visit to Ankara in November last year – his first official visit to a foreign country since taking office.
The signing of the PTA is expected to further consolidate these ties, offering both countries an opportunity to capitalise on trade complementarities. For the Maldives, this agreement could serve as a stepping stone towards expanding its trade footprint in a strategically important market like Türkiye.
Broader Implications of the PTA
The preferential access provided by the PTA is anticipated to boost Maldivian exports by making them more competitive in the Turkish market. Reduced or zero tariffs on Maldivian fish products, which are a staple of the country’s export economy, could lead to increased demand in Türkiye, which has a well-established seafood processing industry. This, in turn, may create more opportunities for Maldivian producers and exporters to penetrate new markets and increase their revenues.
Furthermore, by fostering a more favourable trade environment, the PTA could encourage diversification in the types of goods traded between the two countries, potentially leading to the growth of other sectors within the Maldivian economy.
As the PTA awaits approval from the Turkish parliament, the Maldivian government remains optimistic about the future prospects it presents. If all goes according to plan, the agreement could come into force by the end of the year, marking a new chapter in Maldives-Türkiye economic relations. The move reflects the Maldivian administration’s broader strategy to leverage international partnerships for economic growth and development.
