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MEMO/10/185

Brussels, 12 May 2010

ENP Country report 2009 – Ukraine

The Commission published on 12 May 2010 the so-called neighbourhood package, consisting of an overall assessment of five years of implementation of the European Neighbourhood Policy (ENP), 12 country reports on developments in 2009, including one on Ukraine, and a sector report.

After years of steady progress in many areas covered by the Action Plan, Ukraine witnessed a slowing in the pace of reform in 2009, as a result of global economic and financial crisis and domestic political and constitutional difficulties.

Key reform priorities in 2010 include: efforts to enhance macro-financial stability, reform of the constitution in order to enhance political stability while maintaining the pace of democratic development, energy sector reform (in particular as regards gas), public administration reform, the fight against corruption notably through judicial reform as well as measures to improve the business and investment climate.

Political dialogue and governance, including CFSP

  • An Association Agenda replaced the ENP Action Plan.

  • In early 2010 presidential elections were conducted in Ukraine that met democratic standards.

  • In the course of the year the pluralistic media environment offered Ukrainians a variety of sources of information. The European Convention on Trans-frontier Television entered into force in July 2009.

  • A Gender Equality Commission was established in December 2009 to address antidiscrimination issues and investigate citizens’ complaints.

  • Ukraine aligned itself to nearly all EU’s Common Foreign and Security Policy (CFSP) positions. The possibility of Ukraine’s participation in EU naval operation Atalanta near the coast of Somalia was explored, building on the good experience of its participation in EU operations in the Balkans.

Economic integration and trade

  • The fall in GDP in 2009 is estimated to be as high as15%, due to the global economic and financial downturn.

  • Since November 2009 the IMF has withheld payments under the 24-month Stand-by Arrangement agreed in November 2008 for $16.4 billion, having determined that Ukraine is no longer on track for key conditions. $10.6 billion had been disbursed by July 2009. The EU proposed a macro-financial assistance of € 610 million, subject to IMF Stand-By Arrangement being on track and a number of structural reforms.

  • EU-Ukraine trade fell by 45%, down from over € 39.6 billion in 2008 to € 21.75 billion in 2009. The EU is Ukraine’s no 1 trade partner. Ukraine is the biggest trade partner in the ENP East region, and the EU’s 24th trade partner in the world (0.9% of the EU total trade in 2009).

  • Five rounds of negotiations took place in 2009 for the establishment of a Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU.

Promoting mobility, fighting irregular migration

  • The EU and Ukraine deepened the dialogue on the establishment of a visa free regime for short term travel. A number of expert visits took place in 2009 to identify where improvements are needed in Ukraine’s management of migration flows and border-related issues.

  • Currently, 40% of Schengen visas are delivered free of charge under the Visa Facilitation and Readmission Agreements (active from January 2008).

  • Continued cooperation with Moldova on border management, particularly through the EU Border Assistance Mission (EUBAM), including in the fight against smuggling and illegal trafficking.

  • A Strategic Co-operation Agreement was signed between the EU and Europol at the EU –Ukraine Summit in December 2009.

Sector cooperation - examples

  • Transport: Negotiations on a comprehensive aviation agreement between the EU and Ukraine progressed well in 2009 and could be finalised in 2010, leading to increased air traffic, new and more flight connections, entering new airlines on the market and finally more choice and cheaper prices for passengers.

  • Energy: Significant progress took place in energy cooperation, leading in December 2009 to the approval of Ukraine’s accession to the Energy Community Treaty, pending adoption of a gas law in line with the EU acquis.

  • Environment: In February 2010 the Prime Minister signed a draft national environment strategy up to 2020 which now needs to be urgently approved by Ukraine.

  • Education: Higher education reform process underway is determined by the principles of Bologna Process. In 2007-2009, thanks to Erasmus Mundus grants 452 Ukrainian students and academics could pursue studies in EU universities for up to three years.

  • Health: The EU’s Civil Protection Mechanism (MIC) and bilateral assistance were mobilized following the outbreak, in October 2009, of severe respiratory diseases and influenza A (H1N1). Ukraine participates in newly established EU enlarged health committee, together with EU Member States, EFTA and enlargement countries.

  • Research: In July 2009 Ukraine formally expressed its interest in association to EU’s 7th Framework Programme, and has increased the numbers of submitted applications, with a good success rate, attracting project funding of a total of € 8 million for the period up to the end of 2009.

EU–Ukraine – BACKGROUND

THE POLICY

The European Neighbourhood Policy governs the relations between the EU and Ukraine. In 2009 the EU launched the Eastern Partnership, the Eastern dimension of the ENP framework, aiming at substantially upgrading engagement with the six Eastern neighbours via:

- Bilateral track, whose objectives include Association Agreements, Deep and Comprehensive Free Trade Areas as well as progress on visa and mobility issues

- Multilateral track (i.e. intergovernmental platforms and Flagship Initiatives).

This approach allows for gradual political association and deeper economic integration.

FACTS AND FIGURES

1998: EU- Ukraine Partnership and Cooperation Agreement entered into force.

2005: EU-Ukraine Action Plan was approved

2007: Negotiations started for a far reaching Association Agreement (AA)

2007, 2008 and 2009: The EU's Civil Protection Mechanism (MIC) was mobilised to prepare a first assessment of the environmental damage and needs for pollution remediation efforts in Kerch Strait, in assessing the flooding of the Dnistr (Dniester) and the Prut rivers. to assist Ukraine in the flu pandemic as well as regarding a potential tailing dam collapse in Kalush

2008: Visa facilitation and readmission agreements entered into force. Visa dialogue opened with a visa-free regime as a long term objective

2008: Ukraine joined the WTO, paving the way for the negotiation of a DCFTA with the EU

2007-2010: The ENPI1 envelope for Ukraine stands at € 494 million, with additional allocation of € 28.6 million through the Governance Facility.

2011-2013: An indicative ENPI envelope of € 470.1 million announced by the Commission

2008-2009 – Neighbourhood Investment Facility committed over € 20 million to five projects in Ukraine, mainly in the energy sector

More info at:

http://ec.europa.eu/world/enp/documents_en.htm

http://ec.europa.eu/external_relations/ukraine/index_en.htm

http://ec.europa.eu/world/enp/index_en.htm

1 :

the European Neighbourhood Partnership Instrument


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