Ukraine Open for Free Trade
Ukraine: Key Facts Area:
Location:
603,500 square Kilometers, largest country within Europe
Borders Poland, Romania, Slovakia, Hungary and Moldova in the west, with Belarus and Russia to north and east, and via the Black Sea, Bulgaria, Georgia and Turkey to the south
Trade:
2 1 Geographical center of Europe, making the country an ideal trade hub to the EU, Middle East and Asia
World Trade Organization member
3 Deep and Comprehensive Free Trade Agreement with European Union
4 Free trade: CIS, EFTA, FYROM, Georgia, Montenegro. Finished negotiations with Canada. On-going negotiations Israel and Turkey 2
Free Trade Agreements
Cheaper
Faster
Predictable
Agreements for OPENING new markets for goods and services Make trade CHEAPER - by eliminating substantially all customs duties Make trade FASTER - by facilitating goods transit through customs and setting common rules on technical and sanitary standards Create a more PREDICTABLE policy environment – including in areas that affect trade such as FDIs, IPRs, competition rules and public procurement 3
Ukraine’s Network of Free Trade Agreements European Union (28 Member States)
Entry into force: provisional - 1 January 2016. Unilateral preferences for UA exports applied (pending ratification by all EU Member States)
Former Soviet Union Republics (CIS FTA and bilateral trade agreements) Armenia, Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russian Federation, Tajikistan, Turkmenistan, Uzbekistan Entry into force: CIS FTA 20 September 2012, bilateral treaties entered into force between 1994 and 2006
Scope: liberalization of trade in goods + services + government procurement + gradual legislative approximation and economic integration with the EU Internal Market Population: combined EU-28 States approx. 500 mil
Ukraine Ukraine has concluded 16 FTAs covering a total of 45 countries
Scope: liberalization of trade in goods Total population: approx. 245 mil 4
Ukraine’s Network of Free Trade Agreements Canada Initialed on 14 July 2015 Scope: liberalization of trade in goods + government procurement
Montenegro Entry into force: 1 January 2013 Scope: liberalization of trade in goods + services Population: approx. 0.62 mil
Population: approx. 35 mil
Generalized Systems of Preferences (GSP) Canada, European Union(*), Japan, Turkey and United States (*) GSP arrangement will be terminated after the entry into force of the EU – UA DCFTA on 1 January 2016)
Macedonia Entry into force: 5 July 2001 Scope: liberalization of trade in goods (first agreement concluded by Ukraine with a non-CIS state) Population: approx. 2.1 mil
Scope: liberalization of trade in goods 4
Ukraine’s Network of Free Trade Agreements
EFTA States (Iceland, Liechtenstein, Norway and Switzerland) Entry into force: 1 June 2012 Scope: liberalization of trade in goods + services + government procurement Ongoing negotiations Israel and Turkey
Population: combined EFTA States approx. 13 mil
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Benefits for Ukrainian-Based Manufacturers / Exporters Ukraine-based manufacturers enjoy increased price competitiveness in foreign markets thanks to FTAs
Tariff Concessions
Tariff Concessions for eligible exports: elimination or reduction of import tariffs
Tariff Savings
Tariff Savings. Without FTA importers of Ukrainian exports pay most favored nation tariff (e.g. 10%). With FTA, importers pay “preferential� lower FTA rates for the same goods (e.g. 2%). Making Ukrainian exports more competitive
Cheaper Inputs
Ukraine-based manufacturers can benefit from cheaper inputs that can be imported without (or with lower) import duties and under predictable conditions from FTA partners - in addition to having access to inputs locally available
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Opportunities under the DCFTA
Removal of
Market access
97%
500 million
of duties
consumers
Ukraine and the EU signed the Deep and Comprehensive Free Trade Area on 27 June 2014, as part of the broader Association Agreement Provisional application of DCFTA starting from 1 January 2016. Unilateral preferences for Ukrainian goods applied Removal of 97% of duties on Ukrainian goods and reduction of the average tariff on Ukrainian exports from 7.6% to 0.5% 6
Opportunities under the DCFTA Seven years to adopt EU standards opportunities to invest in modernization
Products certified in Ukraine will be treated equally on the EU market
Agriculture and food safety: gradual alignment to EU standards
Helps to increase efficiency and competitiveness of Ukraine’s industries
Improved access to third country markets through EU standards
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INVEST UKRAINE 45 million domestic consumer base
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Ukraine is open for manufacturing
3 Tap into Ukraine’s FTA network and rethink the way your company does business today
OPEN FOR MANUFACTURING 8
Thank you! www.me.gov.ua