WTO: 2015 NEWS ITEMS

BALANCE OF PAYMENTS


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Since 25 February, Ukraine has been imposing a surcharge of 5% on imports of industrial goods and 10% on imports of agricultural goods to deal with "exceptional conditions" affecting its balance of payments. Ukraine's assessment of its economic and balance-of-payments situation is available here. A background report prepared by the WTO Secretariat  for these consultations is available here.

A representative from the International Monetary Fund (IMF) gave an overview of Ukraine's economic situation, with particular emphasis on balance-of-payments issues, including its level of foreign exchange reserves. The IMF representative also referred to the structural adjustment measures that Ukraine had committed to adopt in the context of the four-year US$ 17.5 billion Extended Fund Facility programme approved by the IMF Board in March 2015.

Ukraine explained that the measure:

  • is applied to all WTO members on a “most-favoured nation” basis
  • covers almost all tariff lines
  • excludes some essential goods including petroleum and pharmaceuticals
  • will be removed no later than the end of 2015
  • has been notified to the WTO Committee on Balance-of-Payments Restrictions
  • does not exceed the extent necessary to address the balance-of-payments problems
  • is adopted in a transparent manner
  • is restrictive but not prohibitive as trade is still flowing into Ukraine.

Some WTO members took the floor to express their views on Ukraine's import surcharge. While most members acknowledged the deterioration of Ukraine's balance of payments, they claimed that the surcharge is causing a burden on their exporters and urged Ukraine to remove the measure no later than the end of 2015. They also urged Ukraine to implement economic reforms and to remain consistent with WTO rules, while looking for less trade-distortive measures. Members also questioned Ukraine on:

  • the economic justification for the measure
  • how the measure is helping to restore Ukraine's balance-of-payments situation
  • its efforts to limit the increase in domestic prices of products
  • the criteria used to determine the two different tariff surcharge rates
  • the criteria used to determine early removal of the measure. 

 

Next

Chairman Ambassador Bertrand de Crombrugghe De Picquendaele of Belgium will continue consulting with members.

The Committee on Balance-of-Payments Restrictions is scheduled to resume its consultations with Ukraine on 11 June 2015.

 

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