CASE Network E-brief: Is Free Trade with the EU Good for Ukraine?

Marek Dabrowski and Svitlana Taran's article is based on the background study on “The Free Trade Agreement between the EU and Ukraine: Conceptual Background, Economic Context and Potential Impact” presented at the workshop on “The EU-Ukraine Association Agreement: Trade and Economic Issues at Stake” organized by the European Parliament Committee for International Trade, Brussels, October 20, 2011.

The negotiations on the Association Agreement (AA) between the European Union and Ukraine, including its trade component, i.e., the Deep and Comprehensive Free Trade Agreement (DCFTA), were completed in December 2011. The agreement is practically ready to be signed, if the EU’s concerns related to the deteriorating political freedoms in Ukraine are addressed. The ball is now in Ukraine’s court and the correct and rapid response is crucial for the country’s future. Both the AA and the DCFTA offer Ukraine an opportunity to deepen its political and economic relations with the EU and modernize its own economy and state institutions. However, if fundamental economic, political, and institutional reforms are not accelerated and conducted in a more comprehensive and consistent way, the prospect of implementing the DCFTA (and its potential benefits) will come under question.