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EU and Ukraine discuss free trade agreement

July 13, 2011

In a process that has not received much media attention outside specialist journals and blogs, the EU and Ukraine have in recent months been negotiating the terms of a free trade agreement. Ukrainian President Viktor Yanukovych and his negotiating team were in Brussels in late June meeting with his EU counterparts. According to EU Observer, a final deal could be signed this December if the remaining disagreements are worked out. This development is surprising for a couple of reasons. First, when Yanukovych came into office last year, many assumed that he would reverse the course of the previous administration and move Ukraine back towards Russia’s orbit. Although he has made several overtly pro-Russian foreign policy decisions (for example, extending Russia’s lease of Black Sea ports in the Crimea), he has also demonstrated an enthusiasm for European integration, at least on the economic front. Indeed, the European free trade agreement, if it is signed, would come at the expense of an alternative customs union involving Russia. Rajan Menon has an interesting piece at Foreign Policy about what Yanukovych’s motives might be.

The other reason Yanukovych’s pro-European attitude has been surprising is that, on the political front, his administration drawn substantial criticism for clamping down on democracy. For example, his administration has pursued criminal charges against opposition figures, including former PM Yulia Tymoshenko, clamped down on media, and altered electoral laws. These actions, and how the EU should respond to them, have provoked an exchange among Ukraine experts that raises interesting questions about whether the EU should prefer the carrot or the stick in dealing with aspiring members. A group of experts co-wrote an article in the Kyiv Post arguing that the EU should not sign any free trade agreement with Ukraine until after the country makes substantial progress on democracy. Political scientist Alexander Motyl replied at World Affairs that a free trade agreement would “nudge” Ukraine towards democracy by familiarizing the country with European business practices and standards and increasing interactions at all levels between EU and Ukrainian citizens and elites. Several co-authors of the original piece penned a reply to Motyl’s piece, reiterating their point that “sticks” were needed as well as carrots, and casting some doubt on Yanukovych’s motives for wanting the free trade agreement.

The exchange is worth a read, as it touches on many of the most vexing question regarding how the EU should relate to its eastern neighbors, an issue that is likely to become more prominent during Poland’s six-month presidency.

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