**EU Plans to Hike Tariffs on Ukrainian Imports, Threatening Critical Revenue Stream**
The European Union is set to impose significantly higher customs tariffs on Ukrainian imports within weeks, potentially dealing a major blow to Kyiv’s economy. The move comes after months of protests by farmers in Poland and other EU countries, who claim that Ukraine’s duty-free trade arrangement has led to significant price drops and income losses for their sector.
**The Impact: A €3.5 Billion Revenue Loss**
Ukrainian officials estimate that returning to pre-war trade conditions would result in a whopping €3.5 billion annual revenue loss. This is due to the EU’s plan to substantially reduce duty-free quotas for agricultural products, such as corn, sugar, honey, and poultry exports. Under the proposed transitional measures, corn quotas would drop from 4.7 million tons to just 650,000 tons, while poultry quotas would decrease from 57,110 to 40,000 tons.
**A Tough Blow for Ukrainian Farmers**
The reduction in duty-free quotas would severely affect Ukraine’s farmers and government budget. Mykhailo Bno-Airiian, trade representative for Ukraine’s employers federation, described the development as “a huge step back” reflecting “a lack of understanding.” He emphasized the need for predictable trade conditions to support Ukraine’s economy during its ongoing war with Russia.
**A Reversal of Previous Promises**
Ukrainian Prime Minister Denys Shmyhal had expressed hope that duty-free and quota-free trade with EU countries could be maintained until at least the end of 2025, providing time to conclude a new bilateral trade agreement. However, it appears that these promises have not been kept.
**A Critique from European Parliament**
Bernd Lange, chair of the European Parliament’s trade committee, criticized the situation, calling it “a really bad signal to Ukraine.” He noted that officials would take at least until October to find a solution and plans to question commission officials about why promised trade talks have stalled despite the long-known June deadline.
**The Bottom Line**
The EU’s decision to hike tariffs on Ukrainian imports is a significant development that threatens a critical revenue stream for Kyiv. The move comes as Ukraine continues to navigate its ongoing war with Russia, making it even more challenging for the country’s economy to recover.
