Ukraine faces USD600-M loss in 2016 due to Russian embargo

November 19, 2015 11:33 am 

MOSCOW, Nov. 19 — Ukrainian Prime Minister Arseniy Yatsenyuk said that Ukraine could lose up to USD600 million in export revenue after Russia scales up trade barriers with the country once the European Union's free trade zone with Ukraine comes into effect.

Ukraine could lose up to USD600 million in export revenue after Russia scales up trade barriers with the country once the European Union's free trade zone with Ukraine comes into effect, Ukrainian Prime Minister Arseniy Yatsenyuk said.

"We are preparing for the free trade zone agreement to be enacted from Jan. 1 next year," Yatsenyuk said.

"We are also preparing for Russia to introduce trade barriers against Ukraine. Ukraine had evaluated its losses from Russia imposing such an embargo. At least for 2016 we can give a preliminary estimate of Ukraine losing around 600 million dollars in exports to Russia," Yatsenyuk told the cabinet on Wednesday.

Russia will ban agricultural and food import from Ukraine from Jan. 1, according to Russian's economic development minister Alexei Ulyukayev's Wednesday statement.

Ukraine's currently untaxed trade with Russia cannot continue once it enters into a free trade zone with Europe, the minister said.

In an attempt to resolve Ukraine's imminent loss, Yatsenyuk ordered the country's foreign ministry to jointly calculate the potential loss with the European Union, and to work out a common plan for overcoming any potential negative consequences of the Russian embargo.

Russia previously expressed concern at possible consequences of the economic part of Ukraine's association agreement with the European Union, stressing that it will act to protect its market from an uncontrolled inflow of cheap food imports from the bloc.

Europe's agricultural produce is heavily subsidized under the union's Common Agricultural Policy (CAP).

According to the European Commission, the European Union spent almost 60 billion euros on financing the CAP in 2014. (PNA/Sputnik)

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