Latest news with #AutonomousTradeMeasures
Yahoo
2 days ago
- Business
- Yahoo
EU tariffs on Ukrainian goods return after 3 years of war, complicating Kyiv's path to European integration
The European Union is set to reinstate tariffs on Ukrainian agricultural exports on June 6. This is the first time since Russia's full-scale invasion that the EU will not renew an agreement suspending trade barriers between Ukraine and Europe. The end of tariff-free trade comes amid mounting opposition to Ukrainian exports — and Ukraine's EU accession — from eastern European bloc members, including Poland and Hungary. While a transitional agreement will govern trade to the end of 2025, negotiations between Brussels and Ukraine for a more favorable long-term agreement began on June 2, according to European Pravda. The temporary arrangement from June 6 allows for more liberal trade than established under earlier rules. But tariffs will return in full starting in 2026 — unless talks in Brussels succeed in updating the pre-war framework. The talks will test the EU's ability to balance concerns from member states with Ukraine's closer integration into the trading bloc. Read also: Who is Nawrocki, Poland's new president, and what could his narrow victory mean for Polish-Ukrainian relations? The so-called Autonomous Trade Measures (ATMs) were introduced in June 2022 shortly after Russia's full-scale invasion of Ukraine. They removed tariffs that applied to some Ukrainian agricultural goods under a 2016 trade agreement, including sugar, honey, wheat, and poultry. Along with "solidarity lanes," which established alternative logistics routes, the 2022 trade measures facilitated the export of Ukrainian agricultural goods by land, bypassing Ukrainian ports blockaded by Russia in the Black Sea. With maritime exports paralyzed, overland shipments to EU neighbors — especially to Poland, Romania, and Hungary — surged, provoking protests from local farmers who claimed Ukrainian goods were overwhelming markets and lowering prices. Although Brussels initially intervened to curb Ukrainian imports, Slovakia, Poland and Hungary applied unilateral bans on some Ukrainian goods in September 2023, citing national security issues but defying EU trade rules. The influx following the trade measures set to expire on June 6 has been touted as a sign of Ukraine's incompatibility with the EU. The issue was on the campaign agenda in the recent Polish presidential election, with both candidates voicing concerns over Ukrainian agricultural imports. According to Svitlana Taran, policy analyst at the Brussels-based European Policy Centre, the 2022 trade measures were not the main driver of the surge. "Politicians have accused ATMs as the primary reason for this situation, which is not the case," she told the Kyiv Independent. "This was an exceptional situation caused by the sudden collapse of Ukraine's main export routes. The influx was not caused by the removal of tariffs, but by Russia's invasion and blockade, and insufficient transport capacities. The suspension of tariffs was just one of the factors, and after Ukraine unblocked Black Sea channels, this situation was eased." European imports of Ukrainian products whose tariffs were lifted did initially spike to an unprecedented level of over 900 million euros, but then quickly declined. Imports of these goods are now generally higher than they were before the full-scale invasion, but not at unprecedented levels. "This example cannot be used to frighten EU farmers that it would be a normal situation if they open their markets to Ukrainian agriculture," Taran added. There is also little evidence that Ukrainian products affected prices in bordering countries. "We looked at (prices) for sugar and found no evidence," Stephan Cramon-Taubadel, chair of Agricultural Policy at the University of Gottingen, told the Kyiv Independent. "I currently have some preliminary results that show slightly depressed local prices for wheat in eastern Polish regions bordering Ukraine in parts of 2023 and 2024, but it's much less than it's made out to be, and something that the EU could easily compensate." Nevertheless, Brussels will not renew the ATMs following longstanding pressure from eastern European countries looking to appease the farmers' lobby. Read also: In wartime Ukraine, a university grows — and reclaims a space once reserved for the corrupt The reversion to pre-war rules is a step back for Ukraine's exporters. The EU has become a closer trading partner for Ukraine since the full-scale invasion began. Over 60% of Ukraine's exports now go to the EU, relative to about 40% before the war. Reverting to the pre-war rules may pose challenges to Ukrainian exporters, who have adapted to trade with fewer tariffs. "It's a challenge, because it's not something businesses were fully prepared for," Veronika Movchan, academic director at the Institute for Economic Research and Policy Consulting, told the Kyiv Independent. "Many hoped that the measures would continue, at least to some extent. I expect that some businesses made decisions based on the existing regime." The Ukrainian Agribusiness Club estimates that, in 2025, Ukraine will lose up to 1.1 billion euros ($1.2 billion) in foreign exchange earnings under the temporary measures, and 3.3 billion euros ($3.7 billion) next year if no agreement is reached. But there may even be barriers to reverting back to the 2016 trading rules, given the fraught politics surrounding the bans currently imposed by Poland, Hungary and Slovakia. "It's not even apparent that, when the free trade measures expire on Friday, these countries will lift the bans," said Movchan. "Some member states even imposed bans on goods that didn't have any barriers before the war, such as sunflower seeds and rapeseed." The episode highlights the potential for domestic politics within the EU and bilateral disputes to impede closer trade relations with Ukraine. It also demonstrates the opportunities for Russia to attempt to derail this process. "One thing we shouldn't underestimate is presumably largely Russian propaganda," Cramon-Taubadel said. "If we look at the channels from which some farmers are getting their information, there is much unsubstantiated fear-mongering claiming that imports from Ukraine are depressing prices." Read also: Controversial Russian literature prize sparks debate on separating culture from war crimes We've been working hard to bring you independent, locally-sourced news from Ukraine. Consider supporting the Kyiv Independent.
Euronews
4 days ago
- Business
- Euronews
EU-Ukraine trade reset: what comes after tariff-free access expires?
Since 2022, trade between the EU and Ukraine has been governed by a temporary framework known as Autonomous Trade Measures (ATMs). Introduced after Russia's full-scale invasion, the ATMs eliminated all tariffs and quotas on Ukrainian agricultural exports to the EU. This offered a critical lifeline access to European markets for Ukrainian producers, especially for agricultural commodities such as grains, maize, eggs, and poultry, sustaining the country's wartime economy. However, the ATM scheme is due to expire tomorrow (5 June), and it cannot be renewed, having already been extended once. Despite efforts since late 2024, the European Commission has failed to secure a permanent or improved replacement, leaving both Ukrainian exporters and EU policymakers scrambling. This delay has frustrated several EU member states, many of whom had expected the Commission to secure a sustainable agreement with Ukraine ahead of the expiration deadline. The political timing didn't help: The Commission faced considerable pressure to avoid inflaming domestic tensions, particularly in Poland, where farmers have protested against the influx of Ukrainian imports. With Poland's presidential elections now behind, Brussels hopes negotiations for a longer-term trade framework can finally move forward. What happens when the tariff-free scheme expires? The most immediate consequence is the reintroduction of tariffs on Ukrainian agricultural goods. In practical terms, this resets trade conditions between Ukraine and the EU to the situation before Russia's 2022 invasion, with tariff lines and quotas from the pre-ATM era reinstated. According to Ukrainian officials, this could cost the country over €3 billion annually in lost export revenue. Because the year is nearly half over, quota limits will be applied on a seven-twelfths basis for the remainder of 2025, proportionally reflecting the reduced time window. The impact will be significant. In 2024, nearly 60% of Ukraine's total exports went to the EU, up from just over 39% in 2021, before the ATMs came into force. The free access to EU markets has been a pillar of Ukraine's economic resilience during wartime, helping to stabilise currency flows and sustain public funding. The loss of preferential market access is not merely an economic inconvenience: It could have direct consequences for Ukraine's ability to fund its war effort. Vitalii Koval, Ukraine's minister of agrarian policy and food, highlighted during a recent visit to Brussels that agriculture represents a much larger share of Ukraine's economy than it does in the EU. One in five Ukrainians works in the agricultural sector, and its performance directly influences national revenues. Ukrainian MP Yevheniia Kravchuk warned that failure to secure even a partial solution could result in a 1% drop in GDP, further straining the country's wartime finances. 'Ukrainian companies have shifted their markets toward the EU. If exports decrease, tax revenues drop, those same taxes that fund our military,' she told Euronews. The reintroduction of tariffs is also expected to suppress producer prices, increase market uncertainty and discourage private investment, hampering both recovery and reconstruction efforts in the longer term. To avoid a sudden rupture in trade flows, the European Commission has prepared transitional measures to apply after the expiration of the ATMs. These were quietly approved two weeks ago by EU ambassadors as a precautionary step, though full details have yet to be published. A Commission spokesperson described the transitional measures as a 'bridge' to allow time for a more comprehensive review of the EU-Ukraine Deep and Comprehensive Free Trade Area (DCFTA), which is the long-term trade agreement underpinning relations before the ATMs. Crucially, the Commission has stated that future trade will be based on the DCFTA, not an extension of the emergency ATMs. This marks a clear shift, disappointing Ukrainian hopes of maintaining the same level of market access they enjoyed under the tariff-free regime. Negotiations toward a revised DCFTA began formally with a meeting in Brussels on Monday afternoon. While details remain scarce, a Commission spokesperson said more clarity is expected "in the coming days". Earlier that day, EU ambassadors met to reaffirm the importance of establishing long-term, predictable trade relations with Ukraine, while also ensuring protections for European farmers, a politically sensitive group in several member states. 'It is an extremely important decision to be taken,' said MP Kravchuk. 'When I hear that, since the full-scale invasion, the EU has spent more on Russian gas and oil than on aid to Ukraine—and now we are talking about cutting economic access meaning that Ukraine's economy in the times of war will be shrinking—then it's a questionable position, rather than a partnership one.' The EU's 27 foreign ministers are scheduled to meet their Israeli counterparts on 23 June for an EU-Southern Neighbourhood ministerial meeting which is aimed at deepening the bloc's cooperation with Israel as well as nine other southern partners including Algeria, Palestine, Egypt, Jordan, Lebanon, Libya, Morocco, Syria and Tunisia. 'The objective is for Israeli representatives to be present at the meeting,' a senior Israeli official told Euronews, adding that the participation of Gideon Saar, Israel's foreign affairs minister 'is still to be confirmed'. But the meeting comes at a time of unprecedented cooling of relations between the EU and Israel following the country's blockage of food from entering into Gaza and after Palestinian health officials and witnesses alleged recent shootings by Israeli soldiers of Palestinians headed for humanitarian aid sites. The Israeli army has said it fired 'near a few individual suspects' who left the designated route, approached its forces and ignored warning shots. The meeting also comes after the EU's foreign policy chief Kaja Kallas stated in late May that the bloc would examine if Israel has violated its human rights obligations under Article 2 of the EU-Israel Association Agreement, which defines the trading and diplomatic relations between both sides. No timeline has been fixed for the review, which will be conducted by the EU's external action service (EEAS). Israeli foreign ministry spokesperson Oren Marmorstein has "completely" rejected the direction taken in Kallas' statement, saying it reflected "a total misunderstanding of the complex reality Israel is facing". The Netherlands, which tabled the move and is considered a firm ally of Israel, said that Israel's 'humanitarian blockade' on Gaza, where a limited quantity of critical supplies entered for the first time in more than eleven weeks on Monday, is in "violation of international humanitarian law" and therefore of Article 2. An EU official said that the 23 June meeting involving Israel will not be a forum to discuss the ongoing war in Gaza but a routine gathering conducted under the EU's Southern Neighbourhood partnership, which is meant to strengthen existing cooperation with 10 southern neighbours on a wide range of issues, including governance, climate change, economic development, energy and migration. In addition, the EU is Israel's biggest trade partner, with the trading relationship valued at more than €45 billion each year. The EU's Southern Neighbourhood partnership derives from the 1995 Barcelona Declaration which committed to turn the Mediterranean into 'an area of dialogue, exchange and cooperation, guaranteeing peace, stability and prosperity', according to an official Commission document. In 2020, trade between the EU and the region represented €149.4 billion and the bloc's imports were worth €58.0 billion. In 2021, the EU 27 agreed to strengthen their partnership with the Southern Neighbourhood following the COVID-19 pandemic and meet their counterparts every year. Their cooperation is based on 'good governance, human rights and fundamental freedoms promotion and protection, democratic institutions and the rule of law", according to 2021 European Council summit conclusions. One of the last EU-Southern Neighbourhood ministerial meetings took place in 2022 in Barcelona, where participants discussed regional cooperation as well as the war in Ukraine.
Euronews
27-05-2025
- Business
- Euronews
EU countries frustrated by Commission's delay on Ukraine trade deal
With an existing temporary trade agreement between the EU and Ukraine set to expire on 5 June, member states have registered discontent with the European Commission's inconclusive negotiation of a future arrangement with the war-torn state. Tensions surfaced during a closed-door session of the EU's monthly gathering of agriculture ministers in Brussels on Monday, during which member states' representatives expressed frustration with the Commission for its failure to clinch a deal with Ukraine, despite having had ample time to do so, two people familiar with the meeting told Euronews. Several ministers said they were unhappy that a stabler and permanent agreement with Ukraine was not reached, according to one of the people. Others emphasised that finding a long-term solution for trade liberalisation with Ukraine should have been a priority for the Commission, which holds exclusive competence for negotiating trade deals, another person said. Currently, trade between the EU and Ukraine is governed by Autonomous Trade Measures (ATMs), which temporarily suspend all tariffs and quotas on Ukrainian agricultural exports. These measures were introduced in response to Russia's full-scale invasion in 2022. However, the ATM scheme is set to expire next week and cannot be renewed again, having already been extended once. With its expiry looming, the Commission has been working unsuccessfully since late 2024 to establish a formal replacement. 'It's no secret that talks between the Commission and Ukraine are underway. Let's say they are still at an initial stage,' Polish agriculture minister, Czesław Siekierski, who currently holds the chairmanship of the EU Agrifish Council, acknowledged during a subsequent press conference. To bridge the gap left by the stalled trade talks, the Commission has prepared transitional arrangements that will apply until a review of the EU-Ukraine Deep and Comprehensive Free Trade Area (DCFTA) is completed and a revised deal is ready. These interim measures were approved last week as a precaution by EU ambassadors. Siekierski noted that the new measures, which replicate the terms of Ukraine's pre-war association agreement with the EU, are 'much less definite' than the ATM scheme regarding limits on Ukrainian agricultural imports. In the meeting, the Commission reiterated its intention to move away from temporary solutions and establish a more stable trading framework. 'Farmers and stakeholders on both sides need predictability to plan ahead,' EU agriculture Commissioner Christophe Hansen told ministers, according to briefing notes shared by Commission spokespersons. Hansen added that the Commission is in active contact with Ukrainian officials to swiftly reach a balanced agreement that reflects the interests of both sides. Agriculture remains the most sensitive issue. The ATM arrangement has triggered backlash in several EU countries, particularly in France and Poland, where farmers have protested against the surge in Ukrainian imports since trade barriers were lifted. On this point, the Commissioner reassured ministers that the transitional measures do not introduce new quotas or increase allowed import volumes for Ukrainian products. The meeting began with an address from Vitalii Koval, Ukraine's minister of agrarian policy and food, who urged the EU to swiftly agree on a new free trade mechanism and find a balanced solution 'based on numbers', according to an EU source. Koval reminded EU ministers that Ukraine is fighting to uphold European values and highlighted the recent toll of three consecutive nights of Russian attacks, which have severely strained the country's infrastructure. In his presentation, Koval underlined how critical the agricultural sector is to Ukraine. The EU source noted that Ukraine's agriculture is seven times more significant to the economy of Ukraine than any EU country, with one in five Ukrainians employed in the sector. Koval also cited a 20.5% drop in available farmland due to occupation, and referenced World Bank figures showing Ukraine has suffered €83.9 billion in agricultural damages and losses due to the war. While the Commission's current position is to reduce the market access levels previously allowed under the ATMs, Ukraine hopes to retain the same degree of access to the EU market. Koval pointed out that 66% of Ukraine's imports come from the EU and argued that if Ukraine were an EU member state, it would rank ninth in terms of agricultural exports within the bloc. He also said he has been holding talks with EU farmers' associations to address concerns about the high volume of Ukrainian imports, as part of Ukraine's push to secure a future agreement with the Commission. Hundreds of farmers descended on Paris on Monday, bringing their tractors - and their frustration - straight to the gates of the French National Assembly. Their goal was to support a divisive piece of legislation tabled by far-right MP Laurent Duplomb. The Duplomb agricultural bill promises to ease what many in the agricultural field see as suffocating administrative constraints. It would make it easier to obtain construction permits for livestock facilities and water reservoirs, and re-authorise the temporary use of certain pesticides such as acetamiprid; a neonicotinoid insecticide banned in France since 2018. While still allowed in other European Union countries, acetamiprid has raised alarms among environmentalists and beekeepers due to its impact on pollinators and potential health risks for humans. The bill was scheduled for debate, followed by a vote in the lower house of parliament on Monday. But opposition lawmakers, mostly from the green and left-wing parties, submitted around 3,500 amendments in an attempt to delay proceedings. With debate threatened by legislative gridlock, centrist, conservative, and far-right lawmakers passed a motion to dismiss debating the bill in parliament. The proposal now moves to a joint committee of seven senators and seven members of parliament (MPs) - most of them supportive of the farmers' demands. The committee will have to agree on a common version that will then be subjected to a final vote by MPs - this time, without the possibility of any amendments. The move has infuriated the left, which has announced plans to file a no-confidence motion against the government in response. For many of the farmers present at the protest, this bill represents a chance to ease mounting pressures, both economic and regulatory. Clément Patoir, a 19-year-old grain farmer, described how bureaucratic red tape is driving young people away from the craft. "There are fewer young people who want to become farmers nowadays. Many children of farmers have to constantly hear about their parents struggling with regulations. It is a complicated job, you work long hours, and you're not necessarily rewarded." "The majority of French farmers are trying to survive. What we all want is to live and not survive. So, fewer constraints and simplification would be much appreciated," Patoir told Euronews. Another young sugar beet farmer, Pierrick, said that the bill is about maintaining production levels. The acetamiprid pesticide is considered essential by many sugar beet and hazelnut producers. "Today, all the methods of production to produce as much as we can are gradually being taken away from us. In addition, we always have administrative constraints that add to our workload ... But to maintain the levels of production that we have, no, there is no alternative today that works," he explained. Supporters of the bill argue that easing restrictions will be critical to avoiding reliance on imports and keeping France's agricultural sector competitive. But environmentalists and left-wing lawmakers see the bill as dangerous. Among those gathered in Paris to oppose it was Gabriel Bertein, a left-wing mayor, who warned of long-term damage to biodiversity and soil health. "If this kind of bill does pass, this will be a sign we are going backwards. We open the doors to more use of pesticide products that we know are dangerous to life," he told Euronews while being heckled by a group of farmers. He added that state funding should shift toward more sustainable farming practices. "We must stop helping and subsidising a type of intensive agriculture that is not going in the right direction. There is an urgent need to change direction, to focus on these topics." Demonstrations are also planned in Brussels next week, targeting the EU's environmental rules and green policy agenda.
Agriland
07-05-2025
- Business
- Agriland
EU agri groups: Past lessons must inform new Ukraine agreement
Agri-food producers and manufactures are urging the European Commission to reflect on the lessons of the past three years when shaping the next phase of the trade relationship with Ukraine. The call comes one month before the expiration of the current so-called Autonomous Trade Measures (ATM). The ATMs, which allow for the suspension of import duties and quotas on Ukrainian exports to the European Union, have been in place since June 2022. The commission said that the measures help alleviate the situation faced by Ukrainian producers and exporters as a result of Russia's 'unprovoked and unjustified war of aggression'. The current measures, which will expire on June 5, include a 'reinforced safeguard mechanism' allowing for quick remedial action in case of significant disruptions to the EU market or the markets of one or more nember states. In addition, an emergency brake applies to eggs, poultry, sugar, oats, maize, groats, and honey, which can be automatically triggered if import volumes reach the average yearly imports recorded between July 2021 and December 2023. Ukraine Eight European agricultural groups representing affected sectors – including Copa Cogeca, the umbrella groups of EU farm organisations and agricultural cooperatives – have now written to the EU Commission to outline their views on the measures. 'The goal should be to secure the economic viability of EU producers while paving the way for a successful and forward-looking partnership—one that fosters synergies and integration between two agricultural powerhouses. 'Since the onset of the war, the EU has recognised its critical role in supporting Ukraine in defending itself and, by extension, the rest of Europe. In these challenging times, continued support for Ukraine is essential. 'However, for that support to be sustainable—and for Ukraine's eventual integration into the EU, in whatever form it may take—it is equally important to ensure that European farmers and manufacturers are not left to shoulder a disproportionate share of the burden. 'Otherwise, we risk weakening the EU agricultural sector and inadvertently strengthening Russia's global position in the long run,' they said. Trade The groups added that 'the liberalisation of trade with Ukraine has had a significant negative impact on several vital EU agricultural and manufacturing sectors'. 'While Ukraine's access to the EU market was meant to support its economy, the reality is that many European producers, especially in sectors such as cereals, sugar, poultry, eggs, ethanol, and honey, have been put under severe pressure. 'These producers face falling prices due to market oversupply, declining market share, logistical constraints, and rising production costs driven by the war, consequently threatening their economic viability, while at the same time allowing Russia to capitalise on the gap left by Ukraine's absence in key markets across North Africa and Southeast Asia. 'The priority is more than ever to guarantee that the economic viability of EU producers is not threatened by unlimited imports, while supporting Ukraine regain access to its traditional markets. 'Otherwise, it would confine both the EU and Ukraine, two of the world's leading agri-food producers, to competing within the same market space, thereby undermining the long-term strategic interests of both partners ahead of the Ukraine accession to the EU,' they said. The group appealed to the EU Commission for a revised association agreement establishing Tariff Rate Quotas (TRQs), similar to those previous to the war.
Yahoo
30-04-2025
- Business
- Yahoo
European Commission confirms it will not extend "trade visa-free regime" for Ukraine
The European Commission does not plan to extend the regime of Autonomous Trade Measures (ATM) for Ukraine (the so-called trade visa-free regime), which is set to expire on 5 June, but it will ensure a smooth transition to a new framework in which all trade liberalisation conditions will be formalised under the EU-Ukraine Free Trade Agreement. Source: European Commission spokesperson Olof Gill during a briefing in Brussels on 30 April, European Pravda reports Details: Gill emphasised that the autonomous trade measures, which remove most barriers for Ukrainian exports to the EU, will not be completely cancelled: all aspects of trade liberalisation between Ukraine and the EU will be embedded in the Deep and Comprehensive Free Trade Area (DCFTA). "Our intention is to ensure a seamless transition to a new regime where all trade arrangements will be baked into the deep and comprehensive free trade agreement we have with Ukraine," said Gill. "So the intention would be to have a transition that allows the ATMs to expire and then all the liberalisation details will be programmed into the DCFTA," he clarified. The European Commission spokesperson stated that he cannot say "when the process will happen". "But it will happen soon and it will proceed in a structured way so that there is no room for doubt as to what has happened," he stressed. "We are going to ensure that there is no need for a snapback. We're going to put in place a process so that as the ATMs expire, that the way we trade on a two-way basis with Ukraine is fully baked into our DCFTA," Gill concluded. Background: European Pravda earlier reported that the Ukrainian government is working with the EU Commission to avoid reverting to the pre-2022 trade regime. In early April, Ukraine's PM Denys Shmyhal called on the EU to extend the "trade visa-free regime" until the end of 2025. On 13 May 2024, the EU Council, after lengthy and tense negotiations, approved the extension of preferential trade with Ukraine for another year – until 5 June 2025. Support Ukrainska Pravda on Patreon!
