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Vira Kravchuk


FT: EU plans to rise tariffs on Ukrainian imports threatening critical revenue stream

Following the protests of farmers in some EU countries, particularly Poland, the EU plans not to extend special trade privileges for Ukraine established after Russia’s 2022 invasion, which can lead to a potential €3.5 billion annual revenue loss.
European Union flag and Ukrainian flag.
Illustrative photo. European Union flag and Ukrainian flag. Credit: Toronto Star
FT: EU plans to rise tariffs on Ukrainian imports threatening critical revenue stream

The European Union is preparing to implement significantly higher customs tariffs on Ukrainian imports within weeks, potentially dealing a blow to Kyiv’s economy during its ongoing war with Russia, Financial Times reports.

The EU’s current duty-free trade arrangement with Ukraine, established in June 2022 following Russia’s full-scale invasion, will expire in June 2025 and will not be renewed. The resulting glut of cheaper Ukrainian products in neighboring EU markets led to significant price drops and income losses for European farmers, prompting political pressure and protests, especially in Poland. The farmers blocked border check points with Ukraine, severely disrupting trade and causing long delays for Ukrainian truck drivers. 

The proposed transitional measures would substantially reduce duty-free quotas for agricultural products by dividing annual quotas into monthly allocations, according to European diplomats cited by Financial Times.

This approach would particularly affect corn, sugar, honey, and poultry exports. Under the plan, corn quotas would drop from 4.7 million tons to 650,000 tons, while poultry quotas would decrease from 57,110 to 40,000 tons. Sugar production quotas would be reduced from 109,000 to 40,700 tons.

A European Commission spokesperson confirmed this development, noting that officials are now “considering possible transitional measures” if negotiations on a revised free trade agreement aren’t completed by 6 June.

Diplomats told Financial Times that the proposed transitional plan would “drastically cut the tariff-free quotas of agricultural products” that have been vital for Ukraine’s farmers and government budget.

Bernd Lange, chair of the European Parliament’s trade committee, criticized the situation, calling it “a really bad signal to Ukraine” and noting it would “take at least until October to find a solution.” His committee plans to question commission officials about why promised trade talks have stalled despite the long-known June deadline.

Ukrainian officials estimate that returning to pre-war trade conditions would reduce the country’s revenues by approximately €3.5 billion annually. Mykhailo Bno-Airiian, trade representative for Ukraine’s employers federation, described the development as “a huge step back” reflecting “a lack of understanding,” and emphasized the need for predictable trade conditions.

Earlier, Ukrainian Prime Minister Denys Shmyhal 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.