EU-Ukraine food deal set to liberalise trade

The EU and Ukraine have struck a long-term trade deal. The agreement, which focuses on food and agriculture, is centred around the liberalisation of Ukraine’s agrifood exports and its integration into the EU’s single market.

What is in the EU-Ukraine food deal?The agreement increases Ukrainian market access to a range of food sectors.

For some “sensitive” commodities – such as sugar, poultry, eggs, wheat, maize, and honey – market access is only increased by a little, upping the quotas slightly. Some products, such as meats (except poultry), were not changed at all.

For others, greater liberalisation has been agreed to a far more significant degree, upping quotas to their greatest extent since Ukraine’s war with Russia began, reports Euractiv. These goods include barley, oats, skimmed milk powder, gluten, and malt.

A third group of goods, including fermented milk, whole milk powder, grape juice and mushrooms, will be fully liberalised.

In return, Ukraine will gradually align with key EU production standards, such as those around veterinary medicines, animal welfare, and the use of pesticides.

Market access concessions granted to Ukraine will be conditioned to its alignment with relevant EU standards by 2028. It will also reduce or eliminate tariffs on its own goods that it exports to the EU.

Both parties will be able to adopt safeguard measures, in the cases where imports may lead to adverse effects for either party.

Measures have been agreed to help Ukrainian exporters meet their traditional markets in third countries.

What is the purpose of the deal?The purpose of the deal is twofold – enhancing Ukrainian access to EU agrifood goods, and giving EU farmers more access to Ukrainian goods. Key figures in the EU have billed it as a win-win for Ukraine and European farmers. In short, it aims to create a level playing field between the two markets.

The deal builds “bridges of resilience and economic solidarity” in the face of Ukraine’s war with Russia, said European Commission President Ursula von der Leyen in a statement. Nevertheless, she stressed, the interests of EU farmers also continue to be safeguarded.

“When negotiating a revised deal for our trade relations with Ukraine, our objectives were clear: keep standing with Ukraine, further align our production standards in view of their accession into the EU, and also have an efficient safeguard mechanism in place to protect our sensitive sectors,” added food and agriculture commissioner Christophe Hansen.

What does the agreement replace?The current trade deal is a revision of the Deep and Comprehensive Free Trade Area (DCFTA), which was negotiated between 2007 and 2011, and signed in 2014.

After Russia’s invasion of Ukraine in 2022, the EU significantly liberalised trade with the country, importing agricultural goods from Ukraine tariff-free. The current agreement replaces this.

This was done in the form of Autonomous Trade Measures (ATMs), which expired on June 5 this year.

Ukraine is often called “the breadbasket of Europe” (alzay/Getty Images)What food does Ukraine export?Ukraine, the largest country entirely on the European continent, has historically been known as “the breadbasket of Europe”, due to its large-scale production of agricultural goods and high yields.

Ukraine has 42 million hectares of agricultural land, much of which includes the highly fertile black “chernozem” soil, according to the World Economic Forum (WEF).

Its main agricultural exports are sunflower oil, corn, wheat, rapeseed and barley.

Ukraine’s war with Russia has put its food exports under strain. While the two countries have signed an agreement to ensure grain can still be exported, recent attacks by Russia have thrown this agreement into doubt, the WEF suggested.