(Bloomberg) -- Turkey criticized U.S. President Donald Trump’s decision to end the nation’s preferential trade treatment, after the move weighed on the Turkish currency.
“The removal of Turkey from the GSP does not comply with our endeavors to achieve $75 billion in bilateral trade volume,” Turkish Trade Minister Ruhsar Pekcan tweeted Friday, using an acronym for the Generalized System of Preferences that lays out the trade status. “Impediments to bilateral trade hinder U.S. firms as well as Turkish firms.”
Turkey’s benchmark Borsa Istanbul 100 Index dropped as much as 0.8% at Friday’s opening. The lira was trading 0.2 percent lower to 6.0583 against the dollar as of 3:30 p.m. in Istanbul after earlier slumping as much as 0.8%.
The White House announced late Thursday that it was removing Turkey’s special designation after announcing his intention to do so in March. Turkey was the fifth largest beneficiary of the program -- which allowed some Turkish exporters to sell products in the U.S. duty free -- in 2017 with $1.7 billion in covered imports to the U.S. and India was the largest with $5.7 billion, according to a Research Service report issued in January.
In Thursday’s release, Trump said the designation of Turkey as a beneficiary developing country is terminated effective May 17 due to “its level of economic development.”
But Trump paired the move with a rollback of steel tariffs against Istanbul that had originally been levied in August. The U.S. cut the tariffs in half to 25%.
The decision to strip some Turkish exporters of their preferential trade status comes amid a broader effort by the Trump administration to reset U.S. trading relationships across the world. American officials are currently pressing Ankara to abandon its longstanding agreement to buy S-400 Russian air defense system.
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