The European Commission has approved this Tuesday a series of measures to limit “temporarily and exceptionally” the imports of a series of Ukrainian products by applying the safeguard clauses of the Regulation of Autonomous Trade Measures. “These measures are necessary given the exceptional circumstances of serious logistical bottlenecks experienced in five Member States”, says the statement made public after the complaints, denunciations and unilateral decisions that in recent weeks deciding to apply Bulgaria, Hungary, Poland, Romania and Slovakia.
After the Russian invasion, the EU mobilized in all possible areas to try to sustain the Ukrainian economy. Two of the most important initiatives in this area were to suspend the application of trade tariffs and open the doors to agricultural products, which in principle would use neighboring countries as a springboard to reach customers from all over the planet. Ukraine is one of the global breadbaskets, but its products could not reach regular customers in Africa or Asia due to the blockade of its ports. In an operation sponsored by the UN, and with Russian approval, land corridors were created so that these cereals could then be distributed from EU cities. The problem is that Ukrainian grain is cheaper than that of neighboring countries and, furthermore, for Ukrainian companies, it was also much more profitable to get to Poland or Bulgaria and Romania than to Germany and the Baltics. So the produce stayed in those markets, prompting protests from local farmers.
First Poland, and then the others, in the absence of general measures, announced the total closure of their borders, for which the EU had to react. After weeks of negotiations, the continental ministers finally reached an agreement over the weekend that there will be restrictions for a set time, but only for four agricultural products: wheat, corn, rapeseed and sunflower seeds originating in Ukraine, and not for meat or dairy, as some capitals wanted.
“The objective is to alleviate the logistics bottlenecks related to these products in. The measures will come into force on May 2 and will last until June 5, 2023,” the statement said. This summer the 27 must decide whether to extend the total exemption from tariffs for another year, an issue that has become very politically sensitive in the aforementioned countries, and especially in Poland and Slovakia, which are holding general elections before the end of the year.
The president of the Commission, Ursula von der Leyen, had asked that there be no irreversible or unilateral decisions. The agreement contemplates that from now until June the original wheat, corn, rapeseed and sunflower seeds can continue to freely enter all the Member States of the European Union, except the five mentioned. For Spain or the Netherlands it was important, and what was negotiated guarantees that the grain can continue to circulate or transit through these five Member States through a common customs transit regime, provided that it does not stay there.
In exchange, those most affected agree to withdraw what they had approved at the national level and that affected more products. “These measures are part of the general support package presented by the Commission and will be complemented by financial support for farmers in the five Member States and other measures to facilitate the transit of grain exports from Ukraine through solidarity corridors to other Member States and third countries”, says the published text.
Brussels already announced that it would double the resources for the Eastern field to 100 million euros to alleviate the damage produced in recent months. “The Commission is ready to start an assessment of the Union market situation for other sensitive products,” explains the Von der Leyen team. But that analysis will not be a matter of days or weeks. There may be damage, but in the rest of the products, from meat to eggs, the market is not saturated and there is no bottleneck in the supply chains, so the urgency is not justified for restrictive measures.
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