Kiev held the first, opening round of negotiations to update the text of the Association Agreement with the European Union. This was told to reporters by the Deputy Minister of Development, Economics, Trade and Agriculture, Trade Representative of Ukraine Taras Kachka.

“This was the first“ opening ”conversation about the text of the agreement itself. For the first time, we formally talked about how and what we can do. We believe that any update or viewing is the development of an agreement within the framework and according to the principles that exist now, ”the Ukrinform official quotes.

According to Kachka, this is not about a radical change in the terms of the agreement, but about the evolution of the document. The trade representative of Ukraine named three main topics of negotiations. Firstly, we are talking about the revision of customs tariffs, since the current duties were agreed upon in the negotiations of 2006-2007.

  • Taras Kachka
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  • © Danil Shamkin / ZUMAPRESS.com

The second set of questions concerns non-tariff barriers, such as the mutual recognition of the conformity of acceptability of industrial products.

In addition, the parties expect to adapt the agreement taking into account changes in the EU regulatory framework that have accumulated over recent years.

“We have clearly fixed our main task for 2020 - to go through all the preparatory work in order to enter the stage of formal negotiations,” Taras Kachka said.

According to the official, the implementation of the plan could lead to the fact that Ukraine will be integrated into the customs system of the European Union.

“In practice, all this can earn in 2021. In this we have great support from the European Union, because everyone understands here: this will mean the removal of restrictions on trade and a very significant reduction in all corruption risks, ”he said.

As an expert of the Council on Interethnic Relations under the President of Russia Bogdan Bezpalko noted in an interview with RT, most likely the negotiations are being held at the initiative of Kiev.

“The fact is that the current association agreement is economically disadvantageous for Ukraine. However, it is unlikely that the document will be substantially changed. Most likely, the parties will change some little things and pass them off as a great success, ”the expert said.

A similar point of view is shared by Mikhail Krivoguz, a leading researcher at IMEMO RAS. As the expert recalled in a conversation with RT, the Association Agreement with the EU was signed by Kiev in a hurry, therefore, as with accession to the WTO, Ukraine did not very actively defend its interests.

“Apparently, it seemed to Petro Poroshenko that in this way he opens Ukraine the way to the EU and dissociates itself from Russia. Therefore, the agreement contains many unilateral concessions to the EU from Ukraine, and it needs to be edited. These negotiations had to be carried out during the preparation of the document, but, of course, better late than never, ”the expert explained.

Revolutionary agreement

Recall that the Association Agreement is concluded by Brussels with states that are not members of the European Union, and is often a prologue to the possible accession of the country to the EU. As a rule, the European Union enters into such an agreement on the terms of full-scale reforms affecting the political, judicial and economic spheres. An association agreement with one or another external partner must be ratified by all countries participating in the European Union.

  • Supporters of Ukraine's European integration on Independence Square in Kiev, 2013
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  • © Ilya Pitalev

Negotiations on the signing of an agreement between Ukraine and the EU began in 2007 and lasted until 2011. The agreement was supposed to include the creation of a free trade zone. In 2012, the parties initialed the document, and in November 2013, the Association Agreement with the EU was to be signed by the parties. However, the Ukrainian government postponed the signing of the document.

As the former president of Ukraine Viktor Yanukovych later explained, this decision was dictated by the desire to protect Ukrainian producers. So, the country's leadership was afraid that European agricultural products would squeeze out their own farmers from the Ukrainian market who did not receive such generous subsidies as their EU counterparts. The situation would be aggravated by an increase in customs duties on the part of Russia because of fears of re-export - Moscow had warned Kiev in advance of such an opportunity.

Viktor Yanukovych’s refusal to sign the Association Agreement, which included political and economic blocs, provoked massive protests in Ukraine. Street performances in the winter of 2014 turned into bloody clashes between protesters and law enforcement officers and ended in a coup d'etat.

The new authorities of Ukraine announced the continuation of the course towards European integration, in the spring of 2014 the EU and Kiev signed the political part of the agreement, and in June the economic part. However, the document did not finally enter into force in 2017, when the agreement was ratified by all EU member states.

Trade imbalance

It should be noted that European agricultural producers affected by the sanctions confrontation between the EU and Russia were not enthusiastic about the need to compete with Ukrainian suppliers in their own market. So, in November 2019, the Polish authorities proposed not to provide Ukraine with new preferences for corn supplies.

“Excessive import of corn from Ukraine has a negative impact on the Polish grain market,” the letter of the Polish delegation to the EU Council said.

However, in fact, the European Union has long taken measures to protect the European agricultural market from Ukrainian exports. Within the framework of the free trade zone created between Ukraine and the EU, a number of restrictions and quotas apply, Ukraine can supply duty-free products only within the specified limits.

  • Ukrainian farmers harvesting
  • Reuters
  • © Gleb Garanich

The limits set for Kiev are relatively small, for example, out of 17 million tons of wheat exported by Ukraine in 2017, duty-free supplies to the EU accounted for only about 800 thousand tons.

After Kiev signed the Association Agreement with the EU, the volume of Ukrainian exports to the European market grew, but rather moderately. If at the end of 2013 this indicator amounted to $ 16.76 billion, then in 2018 the volume of Ukrainian exports to the EU grew only by $ 3.39 billion - up to $ 20.15 billion. According to experts, this growth did not compensate for the loss of trade ties with the Ukrainian economy. By Russia. As the director of the department of economic policy of the Federation of Employers of Ukraine Sergey Salivon told the media earlier, from 2014 to 2019, the volume of trade between Ukraine and Russia decreased by more than three times.

“If we assume that we still buy gas in Russia, then our exports to Russia and our imports from Russia fell by about $ 11.5 billion. Only $ 11.5 billion for Russia is less than 0.8% of GDP, and for Ukraine it is 10% of GDP. That is, the difference in losses is 13 times, ”Salivon admitted.

“Commodity circulation between Ukraine and the EU is growing, but the balance in commodity circulation remains in favor of the European side, which supplies the Ukrainian market with more goods than it purchases,” said Mikhail Krivoguz.

According to the expert, the fact is that Ukraine is mainly engaged in the supply of raw materials, the annual duty-free quotas for these products are small and are exhausted within a few months.

“Ukraine exported engineering products to Russia, that is, goods with high added value. Naturally, Ukraine cannot supply such products to the EU - it does not meet European standards. Therefore, the imbalance in the trade balance between Ukraine and the EU will remain, ”the expert is sure.

Speaking about the motives of the European Union, which at one time pushed Kiev to sign the Association Agreement, experts identify both economic and political components.

According to Mikhail Krivoguz, the EU expects to receive in the person of Ukraine a “raw materials appendage” for its economy, in part this applies to agricultural resources - fertile land. The expert, in particular, drew attention to the fact that statements are being made by European structures that lifting the moratorium on the sale of land in Ukraine should not be accompanied by a ban on the sale of land to foreigners.

“In addition, in the future Ukraine may become a platform for locating enterprises that do not meet European environmental and labor standards. And in general, one should not forget that the latest events in Ukraine are a geopolitical project of the West, ”the expert explained.

On enslaving conditions

The current state of affairs is quite satisfactory for the European Union, which is poorly interested in giving Ukraine the rights of a full member of the association. Although the course on joining the EU and NATO was enshrined in the constitution of Ukraine at the beginning of 2019, experts are not sure that this plan will be implemented - fatigue from Kiev is growing in Europe. This, in particular, was openly stated by Estonian President Kersti Kaljulaid in an interview with Ukrainian media.

  • Emmanuel Macron
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  • © Ian Langsdon / Pool

In turn, French President Emmanuel Macron believes that the European Union should be held back to accepting new members. The politician said this in July 2019, commenting on the results of the EU summit. According to the head of the Fifth Republic, he will oppose any form of enlargement of the European Union until the EU itself is reformed.

Not all EU states would like to see Ukraine in their ranks. For example, in 2016, most residents of the Netherlands spoke in a referendum against the EU-Ukraine association. The Dutch parliament ratified the agreement with Kiev only after negotiations with Brussels, following which it was stated that the document would not become for Kiev an automatic pass to the European Union.

According to Bogdan Bezpalko, all European leaders are well aware that Ukraine’s accession to the EU is not possible in the coming decades, the maximum that the Ukrainian side could try to achieve is to improve the terms of the Association Agreement.

“Now the terms of the Agreement are simply enslaving, quotas provided to Ukrainian suppliers are worked out very quickly. But I doubt that the EU will go to change the conditions of association, as they say in Kiev. The Ukrainian side wants to achieve freedom of movement of capital and people with the European Union, but the EU only does this with respect to its own members, to which Ukraine does not belong and is unlikely to relate at all, ”the expert summed up.