The European Union and Ukraine are engaged in tense negotiations regarding the terms of future trade after June 5, 2024, striving to find a compromise that would prevent a return to old barriers and restrictions that could seriously hinder Ukrainian exports to the EU’s largest markets
Currently, the Ukrainian government, in cooperation with the European Commission, is directly discussing the possibility of prolonging or improving the trade preferences that previously operated under the association agreement. The main goal is to avoid reverting to conditions that existed before 2022, as their reintroduction could result in a reduction of Ukrainian exports to the EU by approximately 1.5 billion USD, which is nearly 4% of the country's total export volume. This information is detailed in a report published by "European Pravda." According to diplomatic sources, if by June 5 no new decision regarding trade conditions is made, the status quo will automatically come into effect—meaning a reversion to the previous provisions of the association agreement. Experts warn that this scenario could lead to catastrophic consequences for Ukraine's exports to the EU, further complicating the country's economic situation. According to research by Veronika Movchan from the Institute for Economic Research and Ricardo Jucchi from Berlin Economics, potential export reductions could reach 1.5 billion USD—an impactful blow that would decrease Ukraine’s revenue and threaten stable development, creating additional challenges for Ukrainian producers and trading networks. However, despite the critical nature of the situation, the European Commission remains firmly committed to supporting and maintaining a more favorable special trade regime for Ukraine. EU officials, including European Commission President Ursula von der Leyen, assured Kyiv during negotiations with Ukrainian Prime Minister Denys Shmyhal on April 9 that the transitional period entails implementing new, even more advantageous trade parameters for Ukraine. These plans involve reviewing the current free trade conditions in accordance with Article 29 of the association agreement. Ukraine emphasizes that their priority is to preserve and strengthen access for Ukrainian goods to EU markets, regardless of the specific form in which the trade regime is implemented. As stated by the Cabinet of Ministers, the key aspect of negotiations is not the formal format of the future agreement but the preservation of extended opportunities for Ukrainian producers. "As for our vision," said government officials, "what matters most is not under what 'shell' the new agreement or regime will be formalized. The main goal is to have stable and unobstructed access to the European market, regardless of the specific wording. This could be either autonomous preferential simplification or a broader regime within the framework of Article 29. In any case, the priority is the outcome—expanding opportunities for Ukrainian goods, not the technical nuances of documentation." Recall that on May 13, 2024, the Council of the European Union adopted a decision to extend the preferential trade regime with Ukraine for another year, until June 5, 2025. This decision is a demonstration of the political will of European partners to support Ukraine during difficult times and to prevent a decrease in exports due to formal or new restrictions. It is also noted that the conditions of duty-free trade between Ukraine and the EU may eventually be integrated directly into the association agreement, opening new prospects for further liberalization. In February 2025, First Deputy Prime Minister Julia Sviridenko stated during a joint meeting of the European Commission and the Cabinet of Ministers that Ukraine’s immediate priority is to complete consultations on this matter, as provided by Article 29 of the agreement, with the aim of establishing new, more favorable conditions for trade relations. More detailed information about the prospects and future development of trade relations between Ukraine and the European Union can be found in the special article of "EuroPravda" dedicated to this topic. It is part of the large-scale project "Trade Wars," supported by the legal firm "Illyashev and Partners." This research provides insights into what new challenges and opportunities Ukraine faces on its path toward integration with European trade and how to respond appropriately to changing conditions in light of the new era in international trade relations.