Canadian Embassy celebrates launch of free trade between Canada, Ukraine (PHOTOS)

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Head of Development Cooperation at Canadian Embassy Karim Morcos talks to the visitors about the start of Canada-Ukraine free trade pact that came into force on Aug. 1.
Photo by Oleg Petrasiuk

A day to remember for Canada-Ukraine relations came on Aug. 1, when a long-negotiated free trade agreement between the countries came into force.

To celebrate the event, the Canadian Embassy in Ukraine invited representatives of the Ministry of Economic Development and Trade, Export Promotion Office, Canada-Ukraine Trade and Investment Support Project, known as CUTIS, as well as business and political leaders to Kyiv’s Terasa restaurant in the Podil district.

Karim Morcos, who heads development cooperation at Canadian Embassy, and Ukraine’s Deputy Economy Minister Nataliya Mykolska, highlighted the main benefit for both Ukrainian and Canadian exporters.

“This is a positive assessment of the Ukrainian reforms by Canada,” said Iryna Lutsenko, the president’s representative in the Verkovna Rada, and member of the Petro Poroshenko Bloc faction.

The free trade pact will open up to 99 percent of the Canadian goods markets for Ukrainian exporters. Ukrainian producers of agricultural products will enjoy preferential trade from the first day. Import duties will be removed for fish, chocolate, juices, beer, oil seeds and peanuts. Duties for beef, lamb meat, sauces will be lifted in three years. Pork, eggs, milk, honey, vegetables will be imported with zero customs fee in seven years from now.

Ukraine will immediately eliminate tariffs on 86 percent of Canada’s exports. This includes elimination by Ukraine of tariffs on all Canadian exports of manufactured goods, fish and seafood, and the elimination of the vast majority of Ukraine’s agricultural tariffs. Key products benefiting from either immediate or eventual duty-free access include beef, pulses, grains, canola oil, processed foods, animal feed, frozen fish, caviar, certain articles of iron and steel, industrial machinery, plastic products, and cosmetics. 

Other Canadian imports to Ukraine will be subject to transitional periods, including construction materials, industrial equipment, aircraft parts, boats, motorbikes, and trailers. There’s a seven-year transition period for passenger cars import.

Despite major liberalization, Ukrainian producers have to meet requirements, including standards on products’ quality and safety requirements, labeling and certification.

There are at least five industries that Canadian buyers are interested in — information technology, clothing, footwear, furniture and confectionery, CUTIS representatives say. They work to match Ukrainian companies with their Canadian counterparts by organizing special missions.

Olga Vergeles of the CUTIS project said that the organization will have a bigger workload because of a competition for Ukrainian companies that will take part in business-to-business meetings with their Canadian counterparts.

Canada is not among Ukraine’s key trade partners. In 2016, Ukraine exported $29 million (0.1 percent of its total) worth of goods and imported $217 million (0.6 percent) of total imports, according to Concorde Capital in Kyiv.

“The mentioned statistics indicate the free trade area won’t have a big impact on the Ukrainian economy anytime soon, but the flows of trade will grow stronger should conditions in Ukraine stabilize,” Concorde Capital analyst Zenon Zawada wrote.

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