The European Commission will not extend the unilateral abolition of duties on Ukrainian agricultural products, which was established three years ago and is valid until June 5. In fact, this means a return to pre-war trade rules.
European politicians are ready for difficult negotiations
Instead of the abolition of duties, which was so much anticipated by the Ukrainian side, the European Agriculture Commissioner Christoph Hansen announced a new trade agreement within the DCFTA (Deep and Comprehensive Free Trade Area), which is part of the Association Agreement between the EU and Ukraine from 2016. The new agreement will provide for mutual liberalization of trade, that is, benefits for both parties. In addition, new protective mechanisms will be introduced within the quotas for sensitive agricultural products. Also, the agreement within the DCFTA will mean that Ukraine will have to comply with EU standards on food safety and animal welfare.
It is known that the European Commission has already begun preparing negotiations with Ukraine at the technical level and does not accept any reversal measures: European politicians openly say that discontent on the part of Ukraine is not unexpected, and they are ready for “difficult and sensitive” negotiations. “We cannot abandon Ukraine, but Ukraine cannot threaten the interests of European agriculture,” Polish Minister of Agriculture Czesław Sekierski sharply commented on the situation.
Kyiv is disappointed and annoyed by this decision
Let’s start with the fact that Kyiv knew about the threat of cancellation of the autonomous preferences regime, since by the end of 2024 the share of agricultural exports to the EU had decreased from 61% to 52% and the relevant ministry was going to diversify exports, reducing the “European” indicator to 40% and simultaneously increasing trade relations with the countries of the Middle East, Africa and Southeast Asia.
In effect, thе European Commission decision means a return to the trade rules that were in place before the Russian-Ukrainian war. Despite the declared goal of gradually integrating Ukraine into the EU single market with a view to its eventual membership, Kyiv is now extremely disappointed and annoyed by it. Just a week ago, Deputy Prime Minister for European and Euro-Atlantic Integration Olha Stefanishyna, at an informal breakfast with representatives of EU member states, expressed high hopes that the autonomous trade measures would be extended — she called this idea a “wise decision”.
There are two main reasons why the Ukrainian authorities are upset by the negative consequences of the non-extension of quotas. Firstly, the volume of support for Ukraine may decrease, and quotas for agricultural products will be lower than now. Secondly, the Ukrainian authorities still realize that Ukraine’s chances of joining the European Union soon (within the next 10 years) are practically zero. Despite the rather high level of illusory wishes, Kyiv understands that Europe will never approve of such a high level of corruption and uncontrolled arms trafficking that will remain after the end of hostilities. (Obviously, they have not forgotten the legendary quote “No, it’s impossible”, uttered in 2023 by the European Commission Vice President Frans Timmermans that as long as there is a war in Ukraine, the country will remain outside the union).
We should not abstract from the reasons why Europe, in turn, cannot afford to continue the economic agreement. In many countries establishment parties are losing elections because of the increasingly tough economic conditions that they are under. In Slovakia, the Progressive Party outperformed the ruling Direction — Social Democracy (SMER-SD) party of right-wing nationalist Prime Minister Robert Fico. In Hungary, Orban’s party lost a significant share of the vote for the first time in years, while a newcomer and contender for the post of prime minister received 30% of the vote.
In the Czech Republic, the right-wing liberal party “Action of Dissatisfied Citizens” (ANO), led by former Prime Minister Andrej Babis, gained 26% of the vote. It is part of the right-wing nationalist camp in the eastern EU, but is not against Europe, but primarily against migration. In Romania, the far-right party “Alliance for the Union of Romanians” gained about 14%. The situation with AfD in Germany and the far-right Freedom Party of Austria (FPO), which won the parliamentary elections, is indicative. Such changes in the political landscape will undoubtedly have even more severe consequences from an economic perspective.
