Brussels, 01/10/2014 (Agence Europe) - In his letter of Wednesday 1 October replying to a letter from Russia's President Vladimir Putin on 17 September, European Commission President José Manuel Barroso reiterated the EU's firm position towards Russia on the EU-Ukraine free-trade agreement - Moscow will not be able to adapt this agreement (ratified by the European and Ukrainian parliaments on 16 September) but the EU wants to continue dialogue in order to take Russia's economic concerns into account. Furthermore, Barroso warns Putin against possible Russian trade retaliation against Ukraine.
The conclusions from the trilateral ministerial meeting on 12 September between European Commissioner for Trade Karel De Gucht, Russia's Minister for Economic Development Alexei Ulyukayev and Ukraine's Foreign Minister Pavlo Klimkin “were endorsed by all participants”, Barroso states. Under the terms of the joint ministerial statement, the Commission agreed to delay the provisional application of the EU-Ukraine free-trade agreement until 1 January 2016, thus giving a period of 15 months to work out how best to respond to Russia's concerns through trilateral consultations.
“I should emphasise that the proposal to delay the provisional application of the DCFTA [deep and comprehensive free trade area] is linked to continuation of the CIS-FTA preferential regime” (between Azerbaijan, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Uzbekistan, Russia and Tajikistan), through which Ukraine benefits from preferential customs duties granted it by these countries. In this context, “we have strong concerns about the recent adoption of a decree by the Russian government proposing new trade barriers between Russia and Ukraine. We consider that the application of this decree would contravene the agreed joint conclusions and the decision to delay the provisional application of the trade related part of the association agreement”, Barroso warns.
Barroso states that the conclusions of 12 September provide for “further consultations on how to address concerns raised by Russia”. “We are ready to continue engaging on how to tackle the perceived negative impacts to the Russian economy resulting from the implementation of the deep and comprehensive free trade area”, he adds. “The association agreement [between the EU and Ukraine] remains a bilateral agreement and, (…) in line with international law, any adaptations to it can only be made at the request of one of the parties and with the agreement of the other, according to the mechanisms foreseen in the text and the respective internal procedures of the parties”, he says.
Barroso also recalls that the joint conclusions of 12 September “state clearly that all these steps are part and parcel of a comprehensive peace process in Ukraine, respecting the territorial integrity of Ukraine as well as its rights to decide on its destiny”. Lastly, he says that “rapid and decisive progress” is expected in the trilateral talks on gas “towards a mutually acceptable interim solution for the upcoming winter period, on the basis of the compromise elements set out” during the trilateral ministerial meeting on 26 October under the mediation of European Commissioner for Energy Günther Oettinger.
In his letter of 17 September, Putin asks the EU to commit to amending the EU-Ukraine free-trade agreement. He speaks of “systemic problems” stemming from this agreement and asks for it to be changed. Russia fears the arrival of European products on its market - to the detriment of Russia's national production. In addition, Russia does not believe that Ukraine can benefit from privileged trade conditions both with Russia and with the EU. The Russian concerns are over tariffs, standards and technical regulation, veterinary and phytosanitary standards, energy, and customs regulations. Moscow has requested over 2,000 amendments to the agreement. (EH)