The EU intends to introduce much higher duties on Ukrainian imports – FT

The EU is preparing to impose much higher tariffs on Ukrainian imports within a few weeks, the Financial Times reports, writes UNN.

DetailsThe decision to end special trade measures that allowed most Ukrainian goods to be imported into the EU duty-free was made after Poland led a movement to protect the bloc’s farmers, diplomats said.

The EU has a free trade agreement with Ukraine, but it went further after Moscow’s invasion in 2022 and temporarily suspended the remaining duties.

These agreements expire on June 6, and the EU plans to replace them with “transitional measures” while both sides update their overall trade agreement.

However, diplomats said that this transitional proposal, recently sent to EU member states, would sharply reduce duty-free quotas for agricultural products – “a lifeline for farmers and Ukraine’s budget.”

Ahead of the presidential elections on Sunday, Warsaw asked the European Commission to “postpone highly unpopular trade talks with Kyiv to minimize the chances of nationalist opposition candidate Karol Nawrocki,” diplomats said.

A European Commission representative confirmed that the post-war arrangements would not be renewed “because we are currently working on a revision” of the free trade agreement between the EU and Ukraine.

“The Commission is also exploring possible transitional measures in case the negotiations are not completed and applied by June 6,” the representative added.

“This is a really bad signal for Ukraine,” said Bernd Lange, chairman of the European Parliament’s trade committee. “At least until October, a solution will have to be found.”

His committee will question European Commission officials on Wednesday about why the promised trade talks have stalled, given that the June deadline was “known for a long time,” Lange said. “The situation is really unacceptable,” he pointed out.

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The Ukrainian government estimates that a return to pre-war trade conditions would reduce its revenues by about 3.5 billion euros per year.

Two EU diplomats told the FT that “the European Commission’s transitional measure envisages dividing the annual duty-free quota into 12 monthly quotas in order to reduce imports while negotiations are ongoing.” “Corn, sugar, honey and poultry will be the most affected,” the publication writes.

It is reported that “the annual quota for corn will decrease from 4.7 million tons to 650,000 tons. For poultry it will decrease from 57,110 to 40,000, and for sugar – from 109,000 to 40,700.”

AdditionThe so-called autonomous trade measures (ATMs), which abolish duties on Ukrainian goods, have been in place since Russia’s full-scale invasion of Ukraine in 2022 to allow Ukraine to export its agricultural products by land.

But EU countries bordering Ukraine, including Poland, Hungary, Romania and Slovakia, have complained that Ukrainian imports are undermining domestic prices and have sparked unrest among farmers.

The European Commission has introduced an “emergency brake” limiting imports of food products such as eggs, poultry, sugar, oats, corn, cereals and honey, which can be activated once import levels exceed a certain threshold.

The measures end in early June and this time, as expected, will not be extended.