European Commission strikes deal for Ukrainian grain imports
The European Commission (EC) reached an agreement with Bulgaria, Hungary, Poland, Romania, and Slovakia regarding the import of Ukrainian agri-food products, much of which happens on the rail. As EC Vice President Valdis Dombrovskis stated, the parties agreed on a new package which will include 100 million euros in financial support for farmers in the five countries. This money is expected to relieve some pressure off of local farmers, who are experiencing significant losses since the import of products from Ukraine in the EU is prioritised.
Tensions between Ukraine and neighbouring EU countries rose in mid-April when Slovakia, Poland, and Hungary banned the import of some Ukrainian agricultural products. The three countries took this initiative after lamenting the lack of solid EU regulations to protect their farmers. With this new deal with the EC, “the neighbouring countries will withdraw their unilateral measures”, Dombrovskis concluded.
Dombrovskis and the EC Commissioner for Agriculture Janusz Wojciechowski met with representatives from the five countries on 19 April and presented the new proposal. Other than financial support for EU farmers, exceptional safeguard measures on key products and measures to facilitate the transit of Ukrainian grain exports via the Solidarity Lanes will be implemented.
The main issue is that the EU’s trade liberalisation and other concessions to Ukraine, implemented in May 2022, are damaging the agricultural sector in all three European countries. These initiatives include the suspension of import duties, quotas, and trade defence measures. The policy is due to expire in less than two months, and the EC already proposed to extend it for another year in February. Slovakia, Poland, and Hungary did not agree with this plan, deeming it damaging for their farmers, and decided to introduce the bans.
On the other hand, Ukraine is dealing with blockades at its ports on the Black Sea and therefore needs alternative outlets for its massive agricultural production. During the first phase of the war, railway companies from all over Europe came to the rescue providing services specifically for the exports of grain from Ukraine into the EU. However, the situation seems to have changed, with neighbouring European countries now seemingly willing to prioritise their national interests, leading to the EC intervention.
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