EU Considers Temporary Trade Agreement with Ukraine Amidst Tariff Suspension Deadline

The European Union is preparing for a potential shift back to its pre-war trade agreement with Ukraine if ongoing negotiations for a new deal are not completed by June 5, the deadline for the expiration of the current tariff suspensions, EU diplomats revealed on Wednesday.

Initially, the EU ditched duties and quotas on agricultural and food products in June 2022, following Russia's invasion, to aid Ukraine in overcoming its export challenges after Russia disrupted traditional shipping routes through the Black Sea. Although Ukraine's finance minister expressed intentions for an extension, the European Commission announced it wouldn't propose a continuation, focusing instead on an updated EU-Ukraine Deep and Comprehensive Trade Area (DCFTA).

Part of this revised agreement would include Ukraine meeting EU production standards and incorporating a safeguard clause to protect both markets. Amid growing protests from EU farmers over an influx of cheaper Ukrainian products, measures such as import 'emergency brakes' have been introduced, specifically targeting poultry, sugar, oats, maize, groats, and honey, which if exceeding average annual imports, could have significant repercussions on prices.

(With inputs from agencies.)