Kyiv is planning a WTO lawsuit against three EU countries over “ridiculous” restrictions, Politico reports.
The refusal of Poland, Hungary and Slovakia to lift the ban on Ukrainian agricultural products led Ukraine to file a lawsuit, Ukrainian trade representative Taras Kachka said.
It is important to prove that these actions are legally wrong. And that’s why we will start start legal proceedings tomorrow.
The bans are designed to protect farmers from a surge in grain exports from Ukraine that followed Russia’s blockade of Ukrainian ports on the Black Sea. Poland’s ruling party is trying harder than others because its success in the 15 October election depends heavily on the support of a rural population. The farmers are angered by the increase in Ukrainian agricultural exports.
The three countries opposed the European Commission, which last Friday decided to allow the sale of Ukrainian grain through the EU.
Kachka said the open defiance of Brussels by Poland, Hungary and Slovakia was not just an internal EU matter, but caused what he called “the biggest systemic problem.” Their actions will call into question whether trading partners can trust what Brussels says on behalf of the EU.
“For many years, it’s been the European Commission who is the trade negotiator and trade policy institution for for the whole EU. And we used to work on this basis. The systemic approach of Budapest and Warsaw of ignoring the position of the EU institutions in trade policy, I think that will be a problem for the EU in general, because there is no unity there.”
Kyiv plans to sue the countries at the World Trade Organisation rather than through its own trade agreement with the EU.
I think that all the world should see how member states in the EU behave towards trade partners and their own Union.
Slovakia extended the previous EU ban on four types of grain. Poland imposed additional bans on Ukrainian flour and feed. Hungary banned another 25 products that had not been discussed previously, including meat.
“These arbitrary prohibitions are ridiculous. I think that Hungary here is making a political statement that it wants to block trade with Ukraine and as well disregard Brussels completely. And that’s why I think this is a very bold move against both of us from Budapest.”
Hungary’s additional bans are mainly of a symbolic nature. However, Poland’s measures affect a significant part of Ukrainian exports. If Warsaw does not change its decision, Kyiv will be forced to “prohibit imports of fruit and vegetables from Poland.”
The governments of the countries claimed that the measures were designed to protect farmers from a sharp rise in supplies of Ukrainian products. The increased imports will lead to lower prices, but Kachka said that such reasoning was wrong.
Poland’s ban will not help farmers, it will not affect prices, because prices are global — what they are doing is based on public opinion.
An EU official told Playbook that Brussels hopes to solve the problem with additional restrictions that Kyiv would impose on exports in the event of a sudden increase.
In response, Kachka said that Kyiv is ready to “take responsibility for ensuring that exports from Ukraine will not cause a tsunami in neighbouring countries.” Ukraine may introduce a system of export licences for grain in order to react promptly if a surge is detected.
