Brussels, 04/10/2012 (Agence Europe) - Headed by the EU and the United States, some 20 WTO member nations criticise Ukraine for its plan to revise customs protection.
Irrevocable blame. After the fashion of the two leading economies in the world, at the WTO General Council on 3 October, Australia, Brazil, Canada, Chile, China, Colombia, Guatemala, Hong Kong, Japan, Malaysia, Mexico, Nigeria, Norway, New Zealand, Switzerland and Turkey strongly criticised Ukraine's proposal to renegotiate its WTO tariff commitments made when it joined the organisation in 2008 regarding duties on imported products. Mid-September, Ukraine had surprised everyone by telling its WTO partners of its wish to step up import tariffs on over 350 products, in a move in line with Article 28 of the General Agreement on Tariffs and Trade (GATT), which provides for renegotiation every three years subject to tariff concessions. The tariff increase envisaged would affect imports exceeding a value of €3.5 billion. Products concerned would include cars, lorries and agricultural machinery, meat, flowers, fruit, vegetables, and washing machines, etc.
Systemic fears. “The EU considers that Ukraine's request raises very obvious and very serious systemic concerns as it risks undermining the credibility of members' commitments to their WTO obligations”, EU Ambassador Angelos Pangratis deplored, saying that the request for tariff renegotiation by Ukraine was the most significant in the history of the WTO. “The EU is of the firm opinion that the procedure set out in Article XXVIII GATT is not meant for renegotiating a significant part of the accession commitments of WTO members”, he said. The article in question allows a WTO member to modify or withdraw a tariff concession provided it maintains a “general level of reciprocity and mutually advantageous concessions not less favourable to trade” than what existed previously. Such reciprocity may be achieved through compensatory adjustment with respect to other products.
Threat of retaliation. US Ambassador Michael Punke, for his part, demanded that Ukraine withdraw its request, and insisted on its “serious systemic implications”. If, failing to reach agreement with its WTO partners, Ukraine were to increase its customs tariffs unilaterally, it would expose itself to legal trade retaliation from other member countries. On Wednesday, the delegations hinted that there was little hope of Ukraine obtaining approval from its partners. The issue is to be examined on 5 October in the EU Council by the trade policy committee. (EH/transl.jl)