Against the background of the world spread fashion to criticize free trade agreements (in the United States election campaign it may even be the main topic), the Government of Ukraine continue to lead a balanced policy on the open access to foreign markets. Without this the export-oriented economy of Ukraine will not grow.

Today the Free Trade Agreement with Canada is to be signed. As in case of any transaction, there are many positives and a lot of nuances.

So, what to look for?

The main success — immediate dismissal from duty of 99.9% of the goods. No transitional periods, quotas and additional conditions (except for the rules on the origin, technical regulations and sanitary requirements, but these are standard items in any trade).

This is very good. However exceptions seem too harsh.

Three broad groups of products — poultry, eggs and dairy products — are completely removed from the free trade.

Regarding these products there are no preferences to us (either in the form of reduced fees or in the form of a tariff quota). However, these exceptions hit all dairy products (for example cheese and ice cream), that the EU fully opened for us.

For Canada, these three groups of products are sensitive because these groups trade is strictly regulated at national level.

Therefore, these are the exceptions for which Canada fights with anyone who is negotiating on free trade. In the latest agreement between Canada and the EU, these product categories are also removed, but Canada provides an additional quota for the cheese from the EU.

This means that further liberalization is possible. Obviously, it is also possible for Ukraine.

The important question of what is more important — the immediate removal of tariffs on 99.9% of the goods and the agreement signed now, or long transitional periods, but having preferences for poultry and milk — belongs to political decisions taken by the government.

What is covered and what is not by the Ukrainian-Canadian agreement? There is no chapter on protection of investments (in the agreement between the EU and Canada this section attracts the most attention), but this is normal because there exists a classical separate agreement on mutual protection of investments.

It is surprising that in the Agreement there is no section on liberalization of services.

Ukraine is a very active exporter of services and its domestic market is open, therefore this is of natural interest — to fight for the liberalization of the market of services.

It is important to pay attention to the sections on the environment and labor. The regulation of these issues is not new for Ukraine — the agreement with the EU includes a chapter on trade and sustainable development, which regulates the same issue.

But there is a significant difference. The Agreement with Canada is made on the basis of the appropriate agreements that exist in the context of NAFTA (North American Free Trade Agreement) which provide a stricter dispute settlement mechanism that envisages also financial responsibility of the parties.

As Ukrainian government has a very weak capacity in this area, perhaps it would be worth fighting for the soft format guarantees (at least, like the ones that are envisaged by the agreement with the EU).

There is a section on the access to the public procurement market — an important addition to the access specified in the WTO agreement and a similar section in the agreement with the EU.

Either way, the agreement provides enough preferences for Ukrainian goods. Therefore, in the system of «victories&betrayals” this is a clear victory of Ukraine.

But there are enough questions to be further solved by another agreement.

eurointegration.com.ua