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Www.ier.kiev.ua1 Ukraines Approach to Regional Integration Efforts: WTO, FTA with EU and FTA with CIS countries Igor Burakovsky, Institute for Economic.

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Presentation on theme: "Www.ier.kiev.ua1 Ukraines Approach to Regional Integration Efforts: WTO, FTA with EU and FTA with CIS countries Igor Burakovsky, Institute for Economic."— Presentation transcript:

1 Ukraines Approach to Regional Integration Efforts: WTO, FTA with EU and FTA with CIS countries Igor Burakovsky, Institute for Economic Research and Police Consulting Athens, February, 2009

2 How to Integrate into the World Economy Basic ways of Ukraines integration into the world economy (as well as for any other country): 1) Through flows of goods, services, capital, labour force and technologies (determined by the level of economic development of the country as such) 2)Through institutions (depends upon the policy of the country towards different international political and economic structures)

3 20 Most Globalized Countries: Economic Dimension KOF 2008 (out of 208) A.T. Kearney/Foreign Policy 2007 Singapore, Luxemburg, Ireland, Malta, Belgium, Netherlands, Estonia, Hungary, Bahrain, Sweden, Cyprus, Czech Republic, Denmark, Chile, New Zealand, Portugal, Finland, Slovak Republic, Austria 78 Ukraine - KOF 17 Ukraine - A.T. Kearney/F oreign Policy Singapore, Panama, Malaysia, Ireland, Czech Republic, Slovakia, Hungary, Denmark, Switzerland, Chile, Romania, Taiwan, Slovenia, Croatia, Austria, Thailand, Ukraine, Australia, Sweden, Israel

4 Integration and Competitiveness Ukraine – 72 nd rank (out of 134 countries) World Economic Forum, Ukraine – 54 th rank (out of 55 countries) Institute for Management Development, 2008

5 Ukraine Foreign Trade: Export (mln USD) Export (total)67002,5 million USD CIS35,5% Russia23,5 % EU27,1% Source: State Statistics Committee

6 Ukraine Foreign Trade: Import, 2008 Source: State Statistics Committee Export (total)85534,4 million USD CIS39,2% Russia22,7% EU33,7%33,7% Source: State Statistics Committee

7 Ukraines Foreign Trade More or less equal distribution of trade flows among major geographical partners Russia still the biggest partner Fundamental trade reorientation ahead or…? Crisis and changes in trade structure Structural changes will determine Ukraine's trade commodity and geographical structure

8 WTO: accession process successfully completed 1993: Intention to join WTO declared 2008: Ukraine became 152 nd member of WTO From 2008 onwards: difficult road of implementation of commitments and mastering WTO as a policy tool Crisis as a source of protectionist mood

9 Ukraines Commitments Market access for goods and services, export restrictions, pricing policies, trading rights, fees and charges for services rendered, internal taxes (VAT and excise tax), customs valuation and customs formalities, industrial policy and subsidies, technical barriers to trade, intellectual property protection, sanitary and phytosanitary measures, TRIMs, etc.

10 WTO: General Regulatory Framework Liberalization of trade regime; Changes of national regulatory regime: introduction of internationally recognized principles, tools and mechanisms; Promoting internal reforms in various fields of economic policies; Conclusion: changes of universal or general nature in trade and trade related policies

11 Ukraine - CIS: Free Trade Arrangements CIS Free Trade Agreement: signed but has to be implemented yet Ukraine ratified CIS FTA Single Economic Space Agreement: intention to have Free Trade Agreement declared Bilateral Free Trade Agreements among CIS countries GUAM (Georgia, Ukraine, Azerbaijan, Moldova) intention to have Free Trade Agreement declared FTA with Former Yugoslav Republic of Macedonia

12 Free Trade Arrangements among CIS countries: Trade liberalization Customs procedures No specific institutional provisions No legal approximation envisaged Conclusion: trade with some exemptions without any reform commitments

13 Ukraine – EU: Some Basic Arrangements in Historic Perspective Agreement on Trade in Textile Products (signed in 1993) Agreement on setting up a Contact Group on Coal and Steel (signed in 1994); Partnership and Cooperation Agreement (signed in 1994); Agreement on Trade in Certain Steel Products (signed in 1997, August 2005); Agreement for Cooperation between the European Atomic Energy Community and the Cabinet of Ministers of Ukraine in the Field of Controlled Nuclear Fusion (signed in 1999). Since 1 January beneficiary of the Generalized Scheme of Preferences (GSP).

14 Ukraine - EU: Way Ahead Negotiations on Association Agreement (with no membership perspective?) Negotiations on Deep Free Trade Agreement (FTA+) What exactly FTA-plus means? FTA with EU: legal approximation and trade liberalization

15 Integration with EU The choice of the European integration option reflects commitment to introduce rules and standards that have already been implemented in the region. Today it is clear that the perspective of EU accession can generate deeper domestic reforms than different regional projects in the CIS region. But both could provide a significant boost to reform by providing incentives for more liberal trade policies and better economic governance. Under certain circumstances even rapprochement with the CIS could be regarded as a movement towards the EU – for instance if universally recognized WTO rules and regulations are introduced within the CIS

16 Thank you!

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