The deal between Ankara and London will roll over the benefits UK and Turkish businesses had while trading with each other when the UK was still part of the European Union. The tariff-free arrangements underpin a trading relationship which the Government said was worth £18.6 billion last year.
The Government said both sides are “committed to working towards a more ambitious free trade agreement”.
The deal was signed during a video call on Tuesday between International Trade Secretary Liz Truss and Turkey’s trade minister Ruhsar Pekcan.
“Today’s deal covers trade worth more than £18 billion, delivers vital certainty for business and supports thousands of jobs across the UK in the manufacturing, automotive and steel industries,” Ms Truss said.
“It paves the way for a new, more ambitious deal with Turkey in the near future, and is part of our plan to put the UK at the centre of a network of modern agreements with dynamic economies.
“More trade and investment will drive economic growth across our United Kingdom and help us build back stronger from Covid.”
The Government has been forced to roll over dozens of trade deals with countries around the world since deciding to leave the EU’s trading arrangements.
A vast majority of the 62 trade deals it has signed over the last two years have simply retained the same terms as before Brexit.
“Turkey’s customs union with the EU made a trade deal with the UK complicated, but the pace at which the deal has been finalised following the negotiated EU deal shows the strength and depth of the relationship,” said Andy Burwell, director for international trade and investment at the Confederation of British Industry.
Turkey has been a particularly key market for the British automotive industry. Ford delivers UK-made car parts to Turkey to build its Transit range, a third of which are then sent back to Britain.
The company makes up around 10% of trade volume between the two countries.
Ford’s Europe president Stuart Rowley said the “trade agreement is extremely significant for us and will help to secure jobs in both countries”.