18:44 20.12.2017

Ukraine's govt prolongs response restrictions on trade with Russia by year

2 min read
Ukraine's govt prolongs response restrictions on trade with Russia by year

Ukraine's Cabinet of Ministers on Wednesday approved the prolongation through December 31, 2018 of the embargo on the import of certain commodities from Russia and the import duty on other Russian goods, which were introduced in early 2016 in response to trade bans and restrictions imposed by Russia on Ukraine.

Ukrainian Prime Minister Volodymyr Groysman said the relevant decrees were adopted on the condition that they be improved.

The Ukrainian government also decided to include on the list of embargoed goods ammonium sulphate, mixtures of ammonium nitrate and calcium carbonate or other non-organic substances that are not fertilizers, polyethylene with specific thickness of 0.94 or more, and polyvinylchloride unmixed with other substances. The changes will take effect on March 1, 2018.

These measures may be lifted if Russia lifts its restrictions on trade with Ukraine.

All goods originating in Russia have been subject to the import duty set by the customs tariff of Ukraine in accordance with the government resolution dated December 30, 2015 since January 2, 2016. Preferential treatment for Russia (free trade) has been canceled due to Russia's violation of the free trade area agreement dated October 18, 2011, the Ukrainian side has said.

The Russian food embargo on Ukrainian goods took effect on January 1, 2016. In response, the Ukrainian government approved countermeasures and banned the supply of Russian food products and other goods whose total import cost is the same as the cost of the Ukrainian exports banned by Russia.

In the meantime, trade between the two countries began recovering this year after a sharp fall in 2014-2016.

In January-October 2017, Ukraine increased its exports to Russia by 20.9% year-on-year to $3.263 billion. The import of goods in that period went up 36.5%, to $5.521 billion, which puts the total increase in bilateral trade in goods at 26.5%, to $8.78 billion.

The trade balance with Russia in the first ten months of this year was negative for Ukraine and stood at $2.258 billion, which is 1.9 times more than last year's figure.

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