Ukraine and EU tie the knot

From Denis Pushilin

Denis Pushilin‏@DenisPushilin

Poroshenko's peace plan is indeed a proposal for the self-defense forces to capitulate. We will never do it. We want freedom.

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Ukraine and EU sign free trade zone deal

Ukraine has signed the economic part of the Association agreement with the EU, with Georgia and Moldova also joining the pact, even though big economic risks lie ahead

RT,

27 June, 2014

The signing of the economic part of the agreement comes after 8 months of violent unrest in Ukraine, which broke out in Kiev and spread across the country in November after then-President Viktor Yanukovich decided to reject the trade agreement in favor of trilateral talks.

The document contains 31 signatures- Ukraine, all 28 EU member states, as well as that of the President of the European Council Herman Van Rompuy, and European Commission President Jose Manuel Barroso. The agreement will only come into force when it is ratified by every national parliament in the EU.

Georgia and Moldova also signed both political and economic parts of the Association Agreement. Ukraine signed a political part of the agreement in March, shortly after Crimea rejoined Russia.

Signing the Free Trade Agreement will open up trade barriers between the former Soviet states, but doesn’t guarantee them EU membership, a main goal of the three governments.

“It is their sovereign right, but the Russian Federation will have to take measures in case it negatively effects the local market,” Dmitry Peskov, Putin’s spokesperson said, commenting on the agreements signed between the EU and Ukraine, Georgia and Moldova.

Russia has warned these "measures" could include $500 billion in lost trade and possible bans on Ukrainian imports.

In order to fully implement the free trade zone, it could cost Ukraine’s already fragile economy additional $104 billion, according to a previous estimate by Yanukovich. This will include adopting hundreds of new trade laws and thousands of new laws to comply with EU standards.

In 2013, EU exports to Ukraine were worth $33 billion (23.9 billion euro), dominated by industrial equipment, chemicals, and manufactured goods.

Ukraine exported 13.8 billion euro worth of goods to the EU, mostly materials like iron, steel, and minerals. Agricultural and food products are also substantial exports.

The Association Agreement and Deep and Comprehensive Free Trade Area (DCFTA) will replace the current Partnership and Cooperation Agreement Ukraine signed with the EU in 1998.

Trilateral trade talks between the EU, Russia, and Ukraine will take place on July 11. Russia has made it very clear that by signing the trade agreement Ukraine can no longer enter the Eurasian Customs Union, which already includes Belarus and Kazakhstan.