EU, Ukraine Begin Applying Trade Deal, Rekindling Russia Tensions

The EU and Ukraine have begun putting into operation their bilateral trade deal since 1 January, in a move that, as was widely expected, has brought long-simmering tensions with Russia on the subject back to the fore. The Deep and Comprehensive Free Trade Area (DCFTA), as the EU-Ukraine pact is known, is part of the larger political and economic Association Agreement between Brussels and Kiev that was signed in mid-2014. (See Bridges Weekly, 3 July 2014 ) When the trade deal was then ratified simultaneously by the European and Ukrainian parliaments in September 2014, the two sides had agreed to delay the application of the pact until 1 January 2016, with officials citing at the time the difficult economic situation in Ukraine. Autonomous trade preferences that Brussels had been granting Kiev since May 2014 were to remain in place, however. (See Bridges Weekly, 18 September 2014 ) Moscow has long argued against the application of the EU-Ukraine trade deal, citing both competitiveness concerns as well as fears that this arrangement could lead to a massive influx of inexpensive European imports into Russia, given its economic relationship and shared border with Ukraine. The compatibility of the trade deal with Ukraine’s involvement...