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Free Trade Agreement the next step in EU-Ukraine integration
March 12 2008 After more than 14 years of negotiations Ukraine has finally got into the WTO. The Ukrainian parliament still needs to ratify the WTO accession agreement, but the recent developments in the Rada suggest that the process might not be as smooth as it should be. Having hardly finished joining the WTO, Ukraine enters another international economic integration exercise. On Feb. 18, European Union Commissioner Peter Mandelson and Ukrainian President Viktor Yushchenko officially launched negotiations for a free trade agreement (FTA) between the EU and Ukraine. With the WTO accession, trade liberalization with the EU will not have much effect on the UkraineEU trade turnover. Therefore, as part of enhancing the bilateral relationship the parties have committed to negotiating a socalled deep free trade agreement that will largely integrate Ukraine into the EU’s internal market. That means that in addition to trade liberalization, significant regulatory harmonization will occur. The benefits of the deep FTA include increase in foreign direct investment and export volumes as well as diversification of exports. Increased international competition will also stimulate Ukrainian enterprises to increase their efficiency. All that will in the very end benefit Ukrainian consumers. However, regulatory harmonization with the EU will mean costs for Ukrainian producers. The negotiations will determine the exact timing and depth of harmonization. The costs, which Ukrainian enterprises will incur in order to comply with the EU regulations, are likely to concentrate in the short to mediumrun, while benefits will appear in the longrun. It is likely that Ukraine will become eligible for the EU money in order to ease the regulatory harmonization. Judging from the progress made in the WTO negotiations we can expect a faster negotiation process for the FTA. Optimists, who are mainly concentrated in Ukraine’s political elite, think that the FTA talks can be completed in a year. Pessimists, who are mainly international experts, speak about three to five years of negotiations. A more realistic estimate of the negotiation’s speed is about one to two years. However, the depth of the agreement should not be sacrificed for the speed of the negotiations. The desire to conduct a shallow and speedy process may bring shortterm political benefits, but will hardly have real impact on the UkraineEU trade volumes and the gains for Ukrainian consumers. The FTA negotiations will involve multiple stakeholders: businesses and various state agencies. If there is a will not to procrastinate with the FTA, the process should be wellcoordinated at the government level. Business associations and large companies should be prepared to come forward with their suggestions for Ukraine’s negotiation positions. So far the government’s efforts to receive inputs from the business community were less than a success. Negotiations of the Agreement will require the involvement of experts. The state should come up with a mechanism to finance the work of external experts. The Yalta European Strategy (YES) plans to get actively involved in the support of the FTA process in Ukraine. YES will conduct an international FTA Forum in order to focus the attention of Ukrainian policymakers on the needs for a successful UkraineEU FTA negotiation. A lot of work and expert analysis has already been done on the issue. Now it is the high time to audit the existing knowledge and help all the agents involved in the process to better understand costs and benefits of the FTA as well as the framework for the forthcoming negotiations. Now there is a need to come up with the list of issues for further investigation as well as with suggestions for the framework in which the FTA negotiations should proceed. International economic integration may seem a painful process for Ukrainian producers. However, the worst one can do for them is to try and shield them excessively from international competition. Competitiveness of Ukraine’s business as the country as a whole will grow only with gradual exposure of producers to greater international competition. JeanPierre Saltiel is former president of the Rothschild Conseil International and cochairman of the Yalta European Strategy Ukrainian Economic Advisory Council. Read more >>>
Німецький політолог Олександр Рар "Україна ще до тепер разколота, а в НАТО ій нічого чекати"
27.11.2007 Daily.ua
Щодо політичної ситуації в Україні, перспективах її вступу до ЄС та НАТО, а також щодо стосунків України з Росією та майбутніх виборах у сусідній північній країні кореспондент Daily.ua спілкувався з відомим німецким політологом та спеціалістом з Східної Европи, членом Правління YES - Олександром Раром. Читати далі >>  
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