Yanukovich touts trade deal with EU

Viktor Yanukovich, the Ukrainian prime minister, once maligned for presiding over rigged elections and a corrupt government, will today (14 September) set out his vision for future ties with the EU.

In his first visit to Brussels since taking office in August, Yanukovich is expected to focus on developing economic relations between the EU and Ukraine, including the establishment of a free trade area (FTA).

Ukrainian officials say that Yanukovich, in contrast to his predecessors, will focus on promoting Ukraine’s interests in both Brussels and Moscow and less on calling for EU membership.

Yanukovich is having meetings with Günter Verheugen and Benita Ferrero-Waldner.

In talks with European Commission President José Manuel Barroso he will argue for a free trade agreement to be agreed in two to three years, bringing Ukraine closer to participating in the EU’s internal market.

The deal, which is being described as a "deep FTA", would include the elimination of "nearly all" quotas and tariffs, including those placed on sensitive agriculture and metal items.

Ukraine would also like to see the agreement cover rules for governing the movement of capital, services and investment.

"It would not just be a classic FTA," said one official, "it can’t [cover] just goods and tariffs. It should include non-tariff issues."

EU diplomats and Commission officials described the push as representative of the increasing interest in European markets among Yanukovich’s traditional business allies from eastern Ukraine.

But diplomats admit that the plan could face resistance from France and other countries which have a record of opposing the opening of agricultural markets and which are also reluctant to approve any move that could be construed as Ukraine edging toward EU membership.

European officials also say that any deal is unlikely to come before Ukraine and Russia join the World Trade Organization (WTO).

Although Ukraine hopes to join the body by the end of this year, it faces problems in striking agreements with existing WTO members, a pre-condition to joining.

Taiwan and Kyrgyzstan have yet to reach a deal with Ukraine and although diplomats are confident of reaching a deal with Taiwan, EU officials suspect that Russia is pressing Kyrgyzstan to delay any agreement.

Russia is struggling to agree a similar deal with the United States and is unlikely to be ready to join by the end of the year, putting Ukrainian membership in further doubt.

Ukraine is likely to push for talks on the FTA to begin in early 2007 to replace existing bilateral agreements.

Yanukovich is expected to use his visit to try to dispel fears that his close ties to the Kremlin will result in a swing towards Moscow.

He is set to point out that it was under his first premiership that the EU and Ukraine agreed to the current framework for political co-operation.

Ukrainian officials hope that an agreement on easing visa requirements for Ukrainian citizens will be reached in time for an October EU-Ukraine summit.

Viktor Yanukovich, the Ukrainian prime minister, once maligned for presiding over rigged elections and a corrupt government, will today (14 September) set out his vision for future ties with the EU.