End of “trade visa-free regime” between Ukraine and the EU: expert named possible scenarios

The economic situation of Ukraine is very difficult, so any additional restrictions on Ukrainian exports are very bad. This was stated by the chairman of the board of the Institute for Economic Research and Political Consultations Ihor Burakovskyi, commenting on UNN the likely end of the “trade visa-free regime” with the EU and named possible scenarios.

The threat of maintaining a free trade regime with the EU

The Ukrainian economic situation is very difficult, so any additional restrictions on Ukrainian exports are very bad. Because Ukrainian exports are, on the one hand, receiving freely convertible currency, and on the other hand, Ukrainian exporters are trying to keep those markets that are under threat today. There is great competition in the markets, and it is clear that if we, due to military problems, logistical problems, fall out of these markets, it is clear that a holy place is never empty. Someone will obviously take them 

In his opinion, the policy of the EU and individual countries is still economic solidarity with Ukraine.

As far as I understand, today the European Union is looking for ways to help Ukraine. I believe that the policy of the EU and the policy of individual countries is, after all, economic solidarity with Ukraine, so I think that some way will be found. What kind of way it will be – you have to look here. This may be an extension of the autonomous trade preferences that are in effect today, or some combined instruments where a decision will be made at the level of Brussels and some decisions will be made at the level of individual countries 

He noted that individual countries are also suffering from competition from Ukrainian goods today.

In general, I am positive. I think we will somehow resolve this problem 

A conflict issue in the context of Ukraine’s European integration

But the issue today is not even the war, Ukraine is negotiating to join the European Union, and we understand that the issue of integrating Ukrainian agriculture into agriculture, the EU economic market is extremely complex. Why? Because Ukraine is in the top 10 or 5 in the production and export of certain products, and this will be the EU’s first experience in integrating such a large agricultural developed  country into the EU. Therefore, I think that the negotiations concerning agriculture will be the most difficult and conflicting. This will be a challenge not only for us, but also for our European partners with whom we are negotiating 

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ContextThe so-called Autonomous Trade Measures (ATM), which abolish tariffs 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 triggered 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 expire in early June and this time, reportedly, will not be extended.  The agreements expire on June 6, and the EU plans to replace them with “transitional measures” while both sides update their joint trade agreement. Meanwhile, as the FT reported, the EU is preparing to introduce much higher tariffs on Ukrainian imports within a few weeks.  

Prime Minister Denys Shmyhal reported on May 16 that Ukraine is in negotiations with the European Commission on the introduction of a certain transitional period of visa-free trade with the EU after June 5.

On May 20, it was reported that Polish Prime Minister Donald Tusk stated in the Sejm that the EU mechanism allowing duty-free imports of goods from Ukraine will cease to operate in June.    

On May 21, the Director of the Department of Agrarian Development of the Ministry of Agrarian Policy and Food of Ukraine, Ihor Vishtak, reported that negotiations are currently underway at the level of the Ukrainian government regarding the extension of the EU mechanism allowing duty-free imports of goods from Ukraine.