Ukraine-EU deal sees the light but there’s no defeat for Russia

Visit of José Manuel Barroso, President of the EC, and Štefan Füle, Member of the EC, to Ukraine (from right to left, Petro Poroshenko, President of Ukraine and José Manuel Barroso, President of EC), (EC Audiovisual Services, 12/09/2014)

Visit of José Manuel Barroso, President of the EC, and Štefan Füle, Member of the EC, to Ukraine (from right to left, Petro Poroshenko, President of Ukraine and José Manuel Barroso, President of EC), (EC Audiovisual Services, 12/09/2014)

While the ceasefire between Ukraine’s military forces and the separatists appears to be holding since the September 5th truce, something “historic” – as leaders called it – might have happened yesterday. Ukraine ratified a landmark trade-and-political deal with the European Union, officially moving towards the West. The moment was crucial not only for the importance of the step taken by Ukraine, but also for the role that this deal played during the whole Ukraine-Russia crisis.

When Ukraine’s then President Viktor Yanukovych refused to sign the agreement on the creation of the EU-Ukraine free trade zone last November, in favour of closer relations with the Kremlin, something changed forever. That was indeed what triggered the protests and riots that eventually led the country into this crisis.

The EU-Ukraine Association Agreement, which includes free-trade provisions and aims to boost Ukrainian exports to the bloc, carries also shadows, along with lights. Last Friday 12 September, days before the EU deal passed with 355 votes in the 450-seat legislature, Russia, Ukraine and the European Union agreed to postpone the creation of the EU-Ukraine free trade zone. Because the trade measures, although ratified, are now set to come into force in December 2015, or even early 2016, instead of November this year as previously planned.
The postponement of the deal is the result of an intense behind-the-scenes activity, as of a delicate diplomatic work, although the delay appeared as a victory for Russia at a first glance.

Russia has been pushing to delay and amend the deal since last year. The Kremlin opposes the free trade provisions, saying it would allow cheap EU goods to flood its market via Ukraine. So until 2016 Ukraine will maintain its existing restrictions on imports from the EU, while having obtained full access to the EU market for its exports. In return, Russia has promised a preferential trade regime for Ukraine.

The delay provides “breathing space to discuss whatever problem may arise”, EU Trade Commissioner Karel De Gucht – which was present last week at the meeting where the postponement was decided – told a news conference.

Ukraine’s President Poroshenko is facing growing criticism in Ukraine for apparently caving in to pressure from Moscow and consequently accepting a delay in signing the deal. On top of that, although most Ukrainians want to move closer to Europe, many of them have reportedly claimed that the price paid during the conflict was too high. “No country has paid such a high price for its European choice”, Mr. Poroshenko said before the vote on the EU deal, and this might be quite a point in both directions – pro or contra a more “European” Ukraine.

So the crisis between Ukraine and Russia has moved into another phase now, from direct conflict into an economic battle. Both Moscow and Kiev seem to be heading towards what could be a cold winter of economic and diplomatic conflict. Signs are already visible, and one of the biggest moves on this delicate and strategic battlefield has already been made.

The reasons behind the postponement of the deal and Russia’s deep concern about an EU-Ukraine deal are not exclusively economic. Russia is not worried of having its market allegedly “flooded” with cheap EU goods, or not so much at least. That is just the official explanation that Russia has given to the European Union. Kremlin can’t simply tolerate the idea of losing Ukraine. This is true both in economic terms, with Russia having a favourable access to Ukraine’s agro-food and energy sectors that just can’t be lost, and in a cultural way. Having some kind of influence on Kyiv is natural for Moscow. This might not mean that Putin wants to re-create a “Sovietic equilibrium” but maybe that Russia doesn’t want to let go another piece of its “empire”. Probably the most precious one.

Along with the trade agreement, yesterday a law that gives “special status” to the eastern regions and provides three years of limited autonomy to territories held by the separatists, saw the light. “There is no military solution for this crisis,” Mr. Poroshenko said earlier this month at the Yalta European Strategy conference and this extremely delicate phase may be the confirmation of that. However, Andrey Purgin, the first deputy Prime Minister of the self-declared Donetsk People’s Republic, told CNN that, although the law represents a point of start for further discussion, rebel leadership feels no obligation after the EU-Ukraine agreement, because it does not consider itself part of Ukraine.

Follow @carlomotta_ on Twitter

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Featured Stings

A voice from Syria: the positive prospect of clinical research despite the excruciating circumstances

The EU Commission does nothing about the food retailing oligopoly

EU readies for eventual annulment of the Turkish agreement on immigrants-refugees

Can We(esterners) ever understand (the) Chinese

The EU Parliament slams Commission on economic governance

Juncker Investment Plan for Europe welcomed by European Youth Forum

Spirit unlimited

Switzerland to introduce strict restrictions on executive pay

The 13th round of TTIP negotiations hits a wall of intense protests and growing concerns

Refugee crisis update: EU still lacks solidarity as Hungary and Slovakia refuse to accept EU Court’s decision

The battle for the 2016 EU Budget to shake the Union; Commission and Parliament vs. Germany

Trailing the US-EU economic confrontation

Is it true that the G20 wants to arrest tax evasion of multinationals?

Conflicting statistics and bad banks haunt the Eurozone

The EU risks trade relations with China over the Tata hype about steel

The European Parliament x-rays the troika’s doings

How ‘small’ is Europe in Big Data?

Has the EU economy truly revived from the financial crisis?

Jo Cox’s murderer believed the ‘leave’ campaign leaders that the ‘remain’ vote is treason

A Sting Exclusive: “The challenge of Society’s digital transformation”, Spanish Minister of Spain for Industry, Energy and Tourism José Manuel Soria live from European Business Summit 2015

Vĕra Jourová, European Commissioner in charge of Justice

The New EU-US “Shield” for data privacy is full of holes

MWC 2016 LIVE: Mobile Connect availability hits 2B

Long live Eurozone’s bank supervisor down with the EU budget supremo

Poverty and social exclusion skyrocket with austerity

The EU threatens to impose extra import duties on Chinese products

Court of Auditors: EU spending infested with errors well above the materiality threshold of 2%

Inegalitarian taxation on labour haunts Europe’s social model

New round of bargaining for the 2014 EU budget late in autumn

What are the real targets of EU’s efforts to fight tax evasion?

Does the Greek deal strengthen the Eurozone? Markets react cautiously

A new European banking space is born this year

The ECB still protects the banks at the expense of the EU taxpayers

Russia and the EU ‘trade’ natural gas supplies and commercial concessions in and out of Ukraine

The EU responds to US challenges by fining Apple with €13 billion

The EU Commission openly repudiates the austere economic policies

EU and African leaders to jointly tackle the migration crisis across the Mediterranean

Eurozone: A Sluggish economy offers no extra jobs

EU: 13 major banks may pay fines 10% of worldwide turnover

Eurozone: The crisis hit countries are again subsidizing the German and French banks

European Business Summit 2013: Where Business and Politics shape the future

The Chinese spirit

Trade protectionism and cartels threaten democracy

The G7 fails to agree on growth but protects the big banks

The European Internet is not neutral and neither is the Commissioner

“Is Europe innovative? Oh, Yes we are very innovative!”, Director General of the European Commission Mr Robert-Jan Smits on another Sting Exclusive

A Sting Exclusive: “Sustainable development goals: what role for business?” Commissioner Mimica asks live from European Business Summit 2015

Theresa May’s global Britain against Philip Hammond’s Brexit fog

Resolving banks with depositors’ money?

The time is up but the game is still not over for Greece: negotiations continue in anticipation of a new deal

Solitary Britain sides with US aggressing Russia and chooses hard Brexit

Auditors say EU spending delivers limited value for money but the timing of their report poses questions

On Brexit: the outcome of UK elections next May to be based on false promises?

COP21 Breaking News_03 December: UNFCCC Secretariat Launches Forest Information Hub

War of words in Davos over Eurozone’s inflation/deflation

Businesses succeed internationally

EU out to conquer African Union summit

Why and how Germany had it again its own way in Cyprus

The European Youth raises their voices this week in Brussels at Yo!Fest 2015

JADE Handover Ceremony at the European Parliement

EU Parliament: Follow the fraudulent money and confiscate it

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s