The Ukrainian government, along with the European Commission, are working to adopt new trade terms that will come into effect after June 5. Otherwise, the provisions of the Association Agreement will be reinstated “by default”, which poses a risk of a significant reduction in Ukrainian exports to the EU. Losses for the Ukrainian economy in this case are estimated at $1.5B, or nearly 4% of total export volume.
However, the EC strongly supports the preservation and enhancement of the current trade regime. EC President Ursula von der Leyen gave assurances during negotiations with Ukrainian Prime Minister Denys Shmyhal that the new trade parameters between Ukraine and the EU will be better than those that were in effect before 2022. This is intended to be achieved by revising and expanding the current free trade regime in accordance with Article 29 of the Association Agreement.
The Ukrainian side emphasizes that the format of the future agreement is not crucial. The primary goal is to preserve and strengthen access for Ukrainian goods to the European market.