Ukraine announced on Monday evening that it had filed lawsuits at the World Trade Organization (WTO) against its three neighboring countries, including its staunchest ally, Poland.

Why have Ukraine and Poland fallen out?

It’s all about grain, so here’s a bit of background…

Russia's full-scale invasion of Ukraine closed Black Sea shipping lanes used before the war, resulting in the European Union becoming a major transit route and export destination for Ukrainian grain bound for Africa and the Middle East, AFP reports.

In May 2022, the EU dropped duties in the wake of the Russian invasion to help Kyiv maintain vital revenues.

Faced with a slump in prices on local markets and angry European farmers, Brussels in spring agreed to allow five countries to restrict imports of grain from Ukraine through September.

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The measures allowed the products to keep transiting through Bulgaria, Hungary, Poland, Romania and Slovakia, but stopped them from being sold on the local market.

What’s changed now?

The European Commission (EC) created the original agreement, which expired last week. The EC refrained from renewing it, citing the disappearance of “market distortions” and improved transport conditions.

This has angered farmers in neighboring countries, who now face stiff competition for their products from the vast volumes of Ukrainian grain which can now – according to the EC – be sold in their countries.

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The import ban is particularly sensitive in Poland, where elections take place next month and the current populist right-wing government of the Law and Justice party has strong support in farming regions.

How have neighboring governments reacted?

Hungary immediately announced it was going to close its border to 24 Ukrainian products, up from 4 previously.

Poland’s populist right-wing government followed suit and extended an embargo on Ukrainian grain, as the issue is particularly sensitive ahead of next month’s elections.

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Slovakia announced it would be banning the import of four commodities, including wheat, until the end of the year.

How has Kyiv reacted?

With the aforementioned lawsuits.

“It is crucially important for us to prove that individual member states cannot ban imports of Ukrainian goods,” Ukraine’s economy minister Yulia Svyrydenko said in a statement.

“That is why we are filing lawsuits against them. At the same time, we hope that these countries will lift their restrictions and we will not have to settle the matter in courts for a long time,” Svyrydenko added.

She said Ukrainian exporters “continue to suffer significant losses” over the bans.

How has Poland responded?

Poland later said the legal proceedings would not change its position and that it would maintain the ban, AFP reports.

“We maintain our position, we think it is correct, it results from an economic analysis and powers derived from EU and international law,” said government spokesman Piotr Mueller on Polsat News.

“A complaint before the WTO doesn’t impress us.”

What happens next?

That remains to be seen but we’ll keep you updated…

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Comments (3)

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Jeff In Canada
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Is it not the markets other than Europe, that Ukraine has lost due to the war? If that is the case, then Ukraine should be lobbying to have their grain shipments approved in European countries, for transit only. But if European countries were already customers for Ukrainian grain, then it looks to me like Ukraine has a solid reason to sue. If not, then it is going overboard, and is going to be counter productive to sue.

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rhoneyman
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At some future point when Ukraine is admitted into the EU, this will cease being a problem.

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Michael
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First question: is Ukraine the only country Poland, Hungary and Slovakia are banning grain from?
Second question: which other countries, if any, do Poland, Hungary and Slovakia import grain from?

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