Media: EU considering not to prolong preferential trade terms with Ukraine
The European Commission is reportedly considering not extending Ukraine's current preferential trade regime, which expires in June, and has already started technical discussions on new trade terms.
As reported by the Polish news portal RMF24, the European Commission is reportedly not planning to extend the special preferential trade regime with Ukraine after 5 June. This regime, introduced in 2022 to support Ukraine's economy, is set to expire.
However, there are no plans to return to the pre-war trade arrangements, as that would deal a significant blow to Ukraine, whose exports to the EU have increased in recent years.
One alternative under consideration is a new agreement within the framework of the Deep and Comprehensive Free Trade Area (DCFTA). This could include setting quotas for certain agricultural products from Ukraine and implementing additional safeguards. This approach could support Ukraine’s gradual integration into the EU single market and prepare it for future membership.
"Most agriculture ministers prefer a more stable DCFTA agreement to extending the current regime. They want to move forward with the DCFTA, where new export and import volumes will be defined," said Christophe Hansen, European Commissioner for Agriculture and Food, adding that this would be "the best solution".
RMF FM reports that the European Commission has already started technical-level negotiations with Kyiv on a new trade agreement, with formal talks set to begin soon.
An unnamed source in the European Commission anticipates that future trade support measures for Ukraine will be more limited, and agricultural imports from Ukraine to the EU may decrease. This shift is partly due to changes in the European Commission's leadership, including the appointment of Slovak Maroš Šefčovič as the new EU trade commissioner, replacing Latvia’s Valdis Dombrovskis. Slovakia’s stance on trade with Ukraine is more aligned with Poland’s position.
Sources in the European Commission say the issue is highly sensitive, as the EU seeks to balance maintaining favourable conditions for Ukraine's economy amid the war with concerns about European farmers' reactions.
Poland recently announced its intention to link negotiations on extending the liberalised trade of agricultural products with Ukraine to discussions on the EU’s trade agreement with South American countries (Mercosur).
On 13 May 2024, the EU Council, after lengthy and intense negotiations, approved an extension of preferential trade with Ukraine for another year until 5 June 2025. Unlike the previous two years, the extension includes restrictions, following protests from farmers.