Trade Policy Review: Ukraine
This first Trade Policy Review has come at an important juncture for Ukraine. Having been through very challenging economic and political circumstances, there are encouraging signs that the Ukrainian economy is stabilizing and that growth may resume. This review has captured the latest development, and shown that the fruits of ongoing reforms could be a strong stimulant for more to come.
Over the past two days, we have had a useful discussion, thanks to the contributions made by the head of the Ukrainian delegation, H.E. Ms Nataliya Mykolska, Deputy Minister of Economic Development and Trade of Ukraine; our discussant, H.E. Mr. Remigi Winzap (Ambassador, Permanent Representative of Switzerland to the WTO); and the 26 delegations that took the floor.
Many Members acknowledged that Ukraine’s accession to the WTO in 2008 provided the foundations for an open, liberal, predictable, and transparent trade regime. In particular, Ukraine was commended for its low, fully bound tariffs and for its extensive commitments under the GATS. In a more benign environment, these should lead to flourishing trade and investment relations between Ukraine and the rest of the world. Some Members also complimented Ukraine for its active participation in the WTO and its acceptance of new obligations under the WTO framework, as seen in its recent ratifications of the Agreement on Trade Facilitation, the Protocol Amending the TRIPS Agreement, and the Agreement on Government Procurement.
Although Ukraine was given due recognition for its many notifications of legislation and trade measures, several Members would like to see greater transparency in Ukraine’s agricultural support measures, the progress of its privatization and ongoing economic reforms, and the operation of its state trading enterprises. Members noted that the predictability of Ukraine’s trade regime, while generally stable, had at times been undermined by certain actions such as its attempt to renegotiate a multitude of tariff concessions, the imposition of temporary import surcharges, and the resort to temporary restrictions on exports and imports. Other areas of concern raised by Members included TBT and SPS measures, IP protection, and Ukraine’s use of contingency measures.
While the adoption of new Tax Codes and Customs Codes were important reform outcomes, it was also noted that legislation was not applied uniformly across all customs offices, and that documentation requirements could still be cumbersome and excessive despite the move towards streamlined electronic procedures. Customs valuation and delays in VAT reimbursement were topics of widespread concern. It was encouraging to hear from the Deputy Minister that Ukraine had taken steps to address these issues. Separately, the rationale for measures such as a ten‑year export ban on timber, local content requirements, and price controls on alcoholic beverages was questioned. One Member highlighted certain trade-related measures which had significant effects on its bilateral economic relations with Ukraine.
Members observed that Ukraine had complemented its WTO commitments with free trade agreements that it had negotiated with key trading partners. The Association Agreement with the European Union stood out among them. Many Members saw it as a comprehensive agenda and catalyst for Ukraine to strengthen its protection of intellectual property rights, align its TBT and SPS standards with others’, and adopt simplified, non-discriminatory and more transparent administrative practices.
Many Members acknowledged Ukraine’s achievements in improving its legal and administrative framework affecting business, and its willingness to make further improvements. Some also encouraged Ukraine to continue its fight against corruption and build a fully independent and efficient legal system.
This Trade Policy Review will be successfully concluded within a month, as soon as Ukraine has responded to all outstanding questions. While Ukraine’s current economic plight may have been driven by forces beyond the scope of our multilateral framework, the long-term strength of Ukraine’s economy will certainly benefit from good governance and the sustained implementation of reforms, with the WTO being an important anchor in this process. Ukraine has expressed its determination to move ahead. By the time of the next TPR, the benefits of such a determined course should be clearly visible.