Solidarity in a European way: The EU puts the final nail in the coffin of “preferential trade” with Ukraine
10 April 2025 12:33
The European Commission will not extend the “preferential trade regime” with Ukraine, which expires on June 5 this year. This intention was confirmed by EU Commissioner for Agriculture Christof Hansen. He ruled out the possibility of extending the current regime, while hinting that many existing trade restrictions are likely to remain in place, "Komersant Ukrainian" reports citing Politico.
The temporary suspension of tariffs and quotas – the so-called Autonomous Trade Measures (ATM) – was introduced for Ukraine after the full-scale Russian invasion in 2022. It will expire on June 5. Negotiations in recent months have focused on a backup plan to replace the ATM with updated restrictions under the 2014 EU-Ukraine Free Trade Agreement.
The move marks a politically sensitive reset after more than a year of pressure from farmers and European Union governments – especially from Poland, France, Hungary and Slovakia. Representatives of these countries argue that cheaper Ukrainian products have flooded local markets due to extreme trade liberalization, although trade experts say the evidence is more mixed.
“The current measures will stop in any case. the [European] Council has made it very clear that there is no possibility of an extension,”
– Hansen told MEPs in the European Parliament’s Agriculture Committee.
In 2024, under pressure from EU governments – led by Poland and France – the Commission imposed safeguard restrictions on several politically sensitive Ukrainian agricultural exports, including sugar and poultry, even while the broader state of emergency remained in effect.
Most of them belong to the group of about 30 Ukrainian agri-food products that are still subject to tariff quotas under the existing EU-Ukraine trade agreement. The Commission will now have to decide which ones will remain restricted – and whether any others should be further liberalized or re-restricted.
Is it possible for Ukraine to bargain for something?
Hansen will meet with Ukrainian Agriculture Minister Vitaliy Koval on Thursday to discuss next steps, according to officials familiar with his schedule.
The European official said the Commission is preparing a new system of tariff quotas, but “not at the same level” as today’s unrestricted access. Nevertheless, he argued that the result would be more favorable for Ukraine than a return to the pre-war terms of the existing free trade agreement.
Ukrainian officials and agricultural groups have warned that the end of the current emergency rules without a fallback option could cost €3.3 billion in exports and reduce gross domestic product by 2.5%. Kyiv had hoped that Brussels would come up with a new proposal, but no draft has emerged.
Informal talks continue, but EU officials privately acknowledge that finalizing a new deal by the June deadline could prove difficult. Brussels is shifting its focus to a trade confrontation with Washington. Domestic politics in key EU countries are also tense.
With Poland’s May 18 presidential election approaching-and a possible runoff just days before the June deadline-Brussels is teetering on a fine line. What was supposed to be a technical adjustment has become a litmus test of the EU’s ability to balance military solidarity with political realities at home. And so far, it seems that solidarity with Ukraine is being pushed further away.
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The preferential trade regime and its enemies
The decision to allow the free import of Ukrainian goods into the EU was made by the EU at the beginning of the full-scale Russian invasion as a gesture of support for the Ukrainian economy, as well as in response to the Russian naval blockade of Ukrainian ports. During the two years of its operation, the simplified regime has gained a lot of opponents in the European Union. In particular, the governments of Bulgaria, Poland, Hungary, Romania, and Slovakia demanded to restrict imports of Ukrainian products (later France joined this position). They claim that cheap agricultural products from Ukraine are swallowing up their markets.
Six major European farmers’ associations also protested strongly against Ukrainian products. Polish farmers have even organized a border blockade, not only with Ukraine but also with Germany.
Nevertheless, after fierce debate, the simplified trade regime with Ukraine was extended until June 5, 2025. However, at the request of these countries, it was severely restricted.
Thus, the provisions on duty-free trade were amended to include new “safeguards” to protect European producers.
In particular, the European Commission may take any measures it deems necessary if imports from Ukraine cause “significant disturbances” on the EU market or the markets of one or more EU Member States. In such a case, the European Commission may launch an “emergency brake” for particularly sensitive agricultural products. This list includes the following products:
- poultry
- eggs
- sugar
- oats
- cereals
- corn;
- honey.
However, the European Commission has not only options but also responsibilities. If imports of these goods exceed the average import volumes recorded in the second half of 2021 and for the entirety of 2022 and 2023, customs tariffs must be restored within 14 days.
Thus, the EU has practically returned import quotas for many Ukrainian goods, albeit at a rather high level.
How the EU is helping Ukraine
At the Munich Security Conference, the United States made it clear to the European Union that Europe’s security is its own problem. After that, the rhetoric of European officials for several days was filled with loud statements that it was time for Europe to wake up and finally start taking care of its own security.
In the context of the Russian-Ukrainian war, European leaders were racing to generate ideas about how they would support Ukraine and how they would help it achieve a just peace. They talked about peacekeepers (who would be in the rear), about closing the skies over Ukraine with British aircraft, about Taurus missiles, and even about the fact that a significant part of the planned 800 billion-dollar EU defense package would go to Ukraine.
A common position on peacekeepers was not reached, talks about Taurus missiles stopped, and meanwhile the EU is making decisions and taking actions that can hardly be called real help to Ukraine in defending Europe.
Just a few days after the Munich conference, it turned out that Belgium would hand over 30 F-16s to Ukraine not by the end of 2025, as planned and promised, but by the end of 2028. The reason was announced: The United States is delaying the delivery of F-35s, which are supposed to replace the F-16s in the Belgian military fleet. 30 F-16s are a significant number, and they could significantly improve Ukraine’s position in the sky, including a very significant boost to its air defense system. Now Ukraine cannot count on these aircraft until 2028.
Later, it turned out that the approved 800 billion euro defense package for Ukraine did not include anything special. It only mentions that Ukrainian defense companies are part of the same “pool” as European ones, which means that purchasing weapons from them is a priority along with EU companies. It is worth noting that this is an important step to help the Ukrainian “defense industry,” but it does not seem quite sufficient in the context of the EU’s loud statements about a common destiny and assistance to Ukraine “as much as necessary.”
At the same time, it turned out that during the third year of the full-scale Russian-Ukrainian war, the EU spent more money on Russian fossil fuels than on financial assistance to Ukraine. During this time, the EU bought 21.9 billion euros worth of Russian oil and gas. This amount is one-sixth higher than the 18.7 billion euros that the EU has allocated to Ukraine as financial assistance in 2024.
The abolition of the preferential trade regime, even in its current lame form, seems to be a logical continuation of this policy.
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