Russia's Punitive Trade Policy Measures Towards Ukraine, Moldova and Georgia

CEPS Working Documents, No. 400

13 Pages Posted: 9 Oct 2014

See all articles by Denis Cenusa

Denis Cenusa

Expert-Grup: Independent Think-Thank

Michael Emerson

Centre for European Policy Studies (CEPS)

Tamara Kovziridze

Free University of Tbilisi

Veronika Movchan

Institute for Economic Research and Policy Consulting

Date Written: September 25, 2014

Abstract

While EU and US sanctions against Russia over its aggression in Ukraine, and Russia’s counter-sanctions, are much discussed due to their evident political significance, less attention has been given to Russia’s punitive sanctions against the three Eastern European states – Ukraine, Moldova and Georgia – that have signed with the EU Association Agreements (AA), which include Deep and Comprehensive Free Trade Area (DCFTA) provisions. This paper therefore documents these trade policy restrictions and embargoes imposed by Russia, and provides some first indications of their impact. The immediate impact on trade flows, especially for agri-food products, has been substantial, albeit with some leakage through Belarus. The main instrument for the Russian measures has been allegations of non-conformity with Russian technical standards, although the correlation of these allegations with movements in Russia’s geopolitical postures makes it obvious that the Russian technical agencies are following political guidelines dressed up as scientific evidence. These measures also push the three states into diversifying their trade marketing efforts in favour of the EU and other world markets, with Georgia already having taken significant steps in this direction, since in its case the Russian sanctions date back to 2006. In the case of Ukraine, Russia’s threat to cancel CIS free trade preferences infiltrated trilateral talks between the EU, Ukraine and Russia, leading on 12 September to their proposed postponement until the end of 2015 of the ‘provisional’ implementation of a large part of the AA/DCFTA. This was immediately followed on 16 September by ratification of the AA/DCFTA by both the Rada in Kyiv and the European Parliament, which will lead to its full and definitive entry into force when the 28 EU member states have also ratified it. However Putin followed the day after with a letter to Poroshenko making an abusive interpretation of the 12 September understanding.

Keywords: Russia, sanctions, Ukraine, Moldova, Georgia, EU Association Agreements, AA, Deep and Comprehensive Free Trade Area, DCFTA

Suggested Citation

Cenusa, Denis and Emerson, Michael and Kovziridze, Tamara and Movchan, Veronika, Russia's Punitive Trade Policy Measures Towards Ukraine, Moldova and Georgia (September 25, 2014). CEPS Working Documents, No. 400, Available at SSRN: https://ssrn.com/abstract=2507195

Denis Cenusa

Expert-Grup: Independent Think-Thank ( email )

45B Pușkin street, 4th floor, MD-2005
mun.Chișinău
Moldova

Michael Emerson (Contact Author)

Centre for European Policy Studies (CEPS) ( email )

1 Place du Congres
Brussels, 1000
Belgium

Tamara Kovziridze

Free University of Tbilisi ( email )

240, Agmashenebeli Alley
Tbilisi, 0159
Georgia

Veronika Movchan

Institute for Economic Research and Policy Consulting ( email )

Reytarska 8/5-A
01034 Kyiv
Ukraine

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