Today, the Association Agreement with the European Union has finally come into force in full.
I dedicate a selection of 10 interesting #victories of Ukrainian exports on the domestic market to this event. As during the free trade area with the EU, it is backed up by new facts and figures.
1. Exports of goods and services to the EU are constantly increasing
As a result of the 6 months of 2017, the European Union is the main trading partner of Ukraine with a total turnover of goods and services of 39.9 percent. Important, that exports to the EU amounted to $9.4 billion and increased by 22.8 percent, or by $1.7 billion.
Thus, Ukraine this year has exported goods at $8.2 billion that is more by 26.1 percent compared to last year. The volume of exports of services amounted to $1.5 billion, due to an increase of 6.4 percent. For example, the exports of electric heaters from Ukraine to the EU increased twice and amounted to $3 million.
2. Ukraine is among the leaders in supplying food to the EU.
Today we make the TOP-10 of the largest suppliers of agricultural products to the EU. Ukraine ranks 8th in this rating. At the same time, in many positions, we have taken the first place: wheat – 32 percent of total imports of the EU, corn – 62 percent, barley – 74 percent and oats – 68 percent, respectfully.
In monetary terms, our corn exports increased by $554 million, i.e. by 35 percent, sunflower oil – by $498 million (by 26.9 percent), soybeans – by $98 million (up to 3 times), margarine – by $18 million (by 13 times!), poultry meat – by $28 million (almost twice).
3. Ukrainian producers of dairy products have conquered the EU market.
Despite the fact that the EU dairy market became accessible to Ukrainian enterprises only from the middle of 2016, Ukrainian milk products have gained popularity among European consumers. Already 18 of our companies can freely sell their produce in EU countries.
Ukraine became the second most important importer of butter to this market. According to the results of the first half of this year, imports of Ukrainian butter accounted for 24.7 percent of the European Union’s imports of products. This product exports totalled $5.3 million, which was twice as much as last year. Our country is second only to New Zealand, which is a long-term leader in supplying butter to world markets.
4. Consumer industrial goods are in increasing demand.
Due to the free trade area with the EU, the exports of Ukrainian ceramic products to the European market this year has grown by 52.3 percent, and total exports amounted to $20 million. Alongside with this, Ukrainian furniture has become popular with its exports growing by 45.6 percent, while hats exports – by 31.2 percent and glass products – by 20.1 percent.
Exports of clothing for men of Ukrainian producers has grown by 12 percent and amounted to $73 million. The EU is the main market for this category of goods.
5. Exports of services to the European Union have also grown.
The growth rate of exports of services is 6.4 percent. Although this is a small figure, it also shows some progress. In particular, travel-related services grew by 18.4 percent, construction services by 17.9 percent, material resources processing by 16.5 percent, business services by 16.0 percent. In addition, services for private individuals, cultural and recreational services has grown by 22.4 percent this year.
Victories of Ukraine from free trade with the EU. (Courtesy)
6. Investments in production on the territory of Ukraine for exports to the EU market are growing.
New capacities of the “Electrokontakt Ukraine” plant that manufactures cables have been opened only recently, in Lviv region, due to the investments of a French company. Its finished goods are later delivered to the EU market for a famous automotive giant. From the very beginning of the free trade area launch, exports of insulated wires and cables began to grow substantially. In 2016, they grew by 7.5 percent, and already in the first half of 2017 – by 16.3 percent.
Exports to the EU of mechanical and electrical equipment and devices for recording or reproduction of image and sound have increased by 20.6 percent during 6 months of this year.
7. Ukraine finalizes its accession to the Regional Convention on pan-Euro-Mediterranean preferential rules of origin.
We consider this step as an instrument to improve preferential trade not only with the EU Member States but also with the members of the European Free Trade Association – Iceland, Liechtenstein, Norway and Switzerland, with countries of North Africa, the Middle East and the Balkans.
8. Ukraine received additional trade preferences from the EU.
We expect that additional trade preferences for Ukraine will soon begin to operate. Recall that the EU decision on this matter has already been adopted, it will come into force in the fall of 2017 and will operate for 3 years. The preferences outside the free trade regime are additional opportunities for duty-free access for certain types of products, both agrarian and industrial ones.
Goods subject to preferences will be exported to the EU under different conditions. For example, for a number of industrial goods such as footwear, copper and aluminium products, liquid crystal displays, etc., the import duty rate shall be reduced since the entry into force of the regulation.
9. We are working to eliminate restrictive measures.
This is an important area of work that requires professional and persistent efforts from both the state and the producers. Recall that in 2012 there were five anti-dumping measures against the Ukrainian goods in the EU market. Now there is only one remaining. We are working to prevent other countries from introducing restrictive measures on Ukrainian products.
10. Systemic promotion of Ukrainian exports to the EU market.
Important tool in the promotion is the introduction of the EU-Ukraine industrial dialogue. It is an interaction tool that will help to increase cooperation in certain industrial sectors. Work in the framework of the dialogue will promote the attraction of Ukrainian industry to the global, European and regional value added chains. In addition, we are talking about direct contacts between business associations of Ukraine and the EU, which will facilitate the path to trade interaction.
EU market it’s new opportunities for Ukrainian exporters!
Nataliya Mykolska, Trade Representative of Ukraine – Deputy Minister of Economic Development and Trade of Ukraine.
