The European Union (EU) and Turkey are to modernise their 20-year-old customs union and look at ways to enhance bilateral trade ties between the two regions.

The move announced last week is aimed at "bringing [the customs union] into the 21st century, according to trade commissioner Cecilia Malmström.

The customs union came into force in 1995 as a first step in Turkey's accession talks with the EU, but the process has been stalled in the face of opposition from some EU member states. Under the agreement, industrial goods are traded duty free.

However, the terms of the pact mean Turkey is unable to pursue a bilateral free-trade agreement with any country until the EU has already established one. It also means non-EU countries with an EU FTA can access Turkey duty-free, but Turkish exporters do not have reciprocal access.

The result is that Turkey’s trade policy has been shadowing that of the EU – and the country is concerned it will lose out as talks progress on the EU’s Transatlantic Trade and Investment Partnership (TTIP) with the United States.

Turkey is the EU's sixth biggest trading partner, and figures from the EC's Directorate-General for Trade show clothing imports into the EU from Turkey in 2014 were worth EUR9.37bn, up 4.9% on the previous year. Textile imports, meanwhile were up 7.5% year-on-year to EUR4.32bn.