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 Former Soviet Union Republics (CIS FTA and January 2016. Unilateral preferences bilateral trade agreements) for UA exports applied (pending Armenia, Azerbaijan, Belarus, Kazakhstan, ratification by all EU Member States) Kyrgyzstan, Moldova, Russian Federation, Tajikistan, Turkmenistan, Uzbekistan Generalized Systems of Preferences EFTA States (Iceland, Liechtenstein, liberalization of trade in goods + Montenegro Macedonia (GSP) Canada and Scope: Norway Switzerland) services + government Entry intoEuropean force: CISUnion(*), FTA 20 September 2012, Entry into 1 5 January July 20012013 procurement + Ukraine Canada, Japan, Turkey Initialed onforce: 14 July 2015 Ongoing negotiations Entry into force: 1 June 2012 legislative approximation and bilateral treaties entered into force between Ukraine 1994 hasgradual concluded 16 and United States Israel and Turkey FTAs economic with + and 2006 arrangement will be terminated Scope: liberalization of trade covering a total of 45 countries (*) GSP Scope: liberalization of integration trade in in goods goods +the EU Scope: liberalization of trade in goods + Internal Marketby Ukraine with a (first agreement concluded after the entry into force of the EU – UA services government procurement services + government procurement Scope: liberalization of trade in goods non-CIS state) DCFTA on 1 January 2016) Population: combined EU-28 States Population: mil Population: approx. approx. 0.62 35EFTA mil Population: combined States approx. mil Total population: approx. 245 in milgoods Population: approx. 500 2.1 mil Scope: liberalization of trade 13 mil 4
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