Because of EU quotas, Ukraine's agricultural sector suffered significant losses - The New York Times

Because of EU quotas, Ukraine's agricultural sector suffered significant losses - The New York Times

Quotas for duty-free imports turned out to be extremely low — even though agricultural products account for 40% of Ukraine's exports.

Reported by the ANTICOR portal quoting the media.

Although EU leaders were glad to welcome Ukraine's turn to the West, this brought no benefit to the country's agricultural sector. Nearly a year has passed since Kyiv's economic integration with the European Union began, and it has been very difficult for Ukrainian agriculture. Andrew Kramer writes about this in The New York Times.

Quotas on product shipments set by the European Union have inflicted huge damage on this sector of the Ukrainian economy. For a number of economic and political reasons, after the collapse of the USSR one of the only truly successful industries in Ukraine turned out to be poultry farming, the article says. As an example, the publication cites the success of the company Avangard, which produced billions of eggs annually, and at a significantly lower cost than competitors from Poland and Germany.

However, when the free trade agreement between Ukraine and the European Union took effect, it turned out that, although EU leaders were glad to welcome Ukraine's turn to the West, this brought no benefit to the country's agricultural sector. "Europe could have opened its borders much wider," the publication quotes the head of the Kyiv School of Economics, Tymofiy Mylovanov.

Quotas for duty-free imports turned out to be extremely low — even though agricultural products account for 40% of Ukraine's exports. For example, the annual quota for honey imports into the EU was exhausted in a month and a half, and eggs were allowed in such small quantities that a single Avangard could exhaust the quota by exporting only 1,5% of its annual production — and that is without considering other companies.

In addition to Europe’s doors remaining effectively closed, Ukraine also damaged relations with Russia, which also struck the country's agricultural sector hard, the author emphasizes. A crisis began in the industry — the same Avangard lost almost 7,5 million chickens and seven farms.

But misfortune did not come alone — because of the situation in the Middle East, shipments to that region have virtually ceased, whereas as recently as 2013 Ukrainian producers were exporting 800 million eggs to Iraq alone.

The election of Donald Trump as U.S. president raised questions about whether America would continue to support Ukraine. In Europe itself, association agreements with Ukraine are also viewed ambiguously — for example, the result of the referendum in the Netherlands in the spring of 2016 shows this. Overall, the prospects for the Euro-association process look extremely uncertain, the author concludes.