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Štefan Füle

European Commissioner for Enlargement and European Neighbourhood Policy

Ukraine: Relations with the EU at the cross-road

Eastern Promises Policy Dialogue organised by European Policy Centre

Brussels, 27 February 2012

Mr Chairman, Ladies and Gentlemen,

Let me start by thanking both the European Policy Centre and the Petro Poroshenko Foundation for the invitation to join today’s discussion.

Today we are discussing “the road ahead” for EU-Ukraine relations. This is an issue which many of you here have spent a great deal of time considering, and one about which I am particularly passionate.

In many ways, the broad direction of this road has already been agreed by both sides. Our destination promises to include enhanced political association, people-to-people contacts and economic integration.

We have even mapped out the path to these goals: the EU-Ukraine Association Agenda and Visa Liberalization Action Plan are in place. The Association Agreement including DCFTA are negotiated and ready for initialling.

Yet there can be no doubt that significant challenges remain as we travel the road ahead. The coming year will be crucial, and there are a number of steps that Ukraine must take to make the journey as smooth as possible. There have been several paradoxes on this road in Ukraine in the recent past. So let´s turn 2012 into a year without paradoxes.

Dear friends,

We are at a critical point in EU-Ukraine relations.

The finalisation of negotiations on the Association Agreement including DCFTA at the EU-Ukraine Summit in December was a major achievement, and it showed what can be done when we work together on substance. The EU remains strongly committed to political association, and we look forward to initialling the Agreement as soon as possible.

Ukraine’s negotiators deserve much praise for their ability to navigate this demanding and complex process to its end, and I would like particularly to recognize the leadership shown by Andriy Klyuyev in this regard.

Yet, at the same time, the EU-Ukraine Summit highlighted significant concerns in a number of important areas. Selective justice, the business climate and constitutional reform were just three of the key areas where developments have fallen below expectations.

This has been disappointing, and I know that these concerns have been shared by a number of those here, including other members of the panel who have fought very hard to advance the EU-Ukraine agenda.

But let me be clear: the need to secure democracy, human rights and the rule of law remains at the very heart of the Eastern Partnership. Reform in these areas will continue to be non-negotiable, and it will be essential that Ukraine demonstrates its firm commitment to these core values.

We will continue to use every resource at our disposal to support Ukraine in this process. But the timing of the signature and ratification of the Association Agreement will ultimately depend on how successful Ukraine is in achieving reform in these core areas.

Ladies and gentlemen,

The coming year will be crucial in determining the nature of the road ahead for EU-Ukraine relations. I see four further reasons for this:

First, it is the year of parliamentary elections. This will test the health and viability of Ukraine’s democracy, not just in terms of the voting process, but also in relation to freedom of the media and other basic freedoms. It will also test the ability of opposition leaders to participate actively in the campaigns.

Second, it is the year when constitutional reform in Ukraine should begin to deliver results. This should pave the way for an overarching political and governance framework which has broad support and which stands the test of time. I am not sure we have achieved that yet.

Third, it is the year of the Euro 2012 tournament. Ukraine and Poland will be on show as never before, with a unique opportunity to win friends and encourage visitors and investors.

And, fourth, this is the year when the Association Agreement including DCFTA will finally be delivered into the public domain by our negotiators. I hope that this will give a renewed sense of strategic direction to both the EU and Ukraine, and, in a broader sense, to other Eastern Partners as well.

Ladies and gentlemen,

These are just a few of the reasons why the coming year will be such a critical phase in our journey.

But there are a number of concrete steps that Ukraine can take to make the road ahead as smooth as possible, and to demonstrate that it is laying the foundations for political association.

I would like to highlight the need for action in six key areas which I consider to be particularly important.

The first step is to recognize the failings of the justice system in a number of cases, including, but not only, that of Mrs Tymoshenko. Today's verdict on Yuriy Lutsenko is further evidence that this is a systemic problem encompassing all aspects of judicial process. These trials and detentions have elicited criticism from independent experts around the world. Wide judicial reform based on expert advice, and carried out openly and with appropriate consultation, would show that the rule of law lies at the centre of Ukraine's agenda for change and is not applied on a selective basis.

As part of this, the Ukrainian authorities should also make public the preliminary observations of the Council of Europe Committee for the Prevention of Torture from their recent visit to Ukraine. This visit included an assessment of the health care being provided to a number of those currently in detention.

The second step would be to follow this up with progress on other reforms related to the rule of law. These include laws on freedom of assembly and NGOs, and amendments to the laws on the Judicial System and the Status of Judges. These should be brought into line with the recommendations made by the Council of Europe.

The third step would be to prepare the parliamentary elections so that all political forces are confident that democracy is observed in spirit as well as in law. Outstanding recommendations from the Venice Commission on the legal framework should be clearly followed. Observers from bodies such as OSCE-ODIHR should be invited to monitor the elections. And fair access to the media and freedom of assembly should be guaranteed.

The fourth step is to drive forward constitutional reform in close consultation with the Venice Commission. The establishment of a single independent body dedicated to this issue would be an important step, and would help to guarantee that the process was undertaken in an open and participatory way. It is important that the government creates conditions for the opposition to play a role in this process and it is also important that the opposition plays a constructive role in supporting change. All Ukrainians have a stake in this process and it is vital to get it right.

The fifth step is for Ukraine to take the necessary steps to unblock two significant financial resources. First, if the Civil Service Law is not amended to bring it in line with EU and international standards, Ukraine could lose €70 million of 2011 funds. But there could be other funds lost, too. These funds are intended to support Ukraine's public administrative reform, which we consider so important.

Second, two general conditions for budgetary support on progress in public finance management reforms and macroeconomic stability remain under review. Until these conditions are met, the 2011 and 2012 budget support disbursement requests by the Government, amounting to €167 million, must remain on hold. Therefore, it would be a significant step forward if Ukraine can adopt a comprehensive reform strategy on public finance management in agreement with the EU and start to deliver on it.

2012 is an important year to unblock these financial resources.

And finally, it's about time for Ukraine's efforts to secure a market oriented price for its gas to be successful. We have always supported these efforts and we are ready and willing to participate in discussions about a trilateral consortium on the Ukrainian gas transit system. Such a triangle would logically represent the producer, transit country and the consumer.

It is crucial that any gas agreement with Russia also guarantees full respect for Ukraine's obligations under the Energy Community Treaty. This not only forms a key part of the Association Agreement, but is also essential for the country's future energy security and independence.

These are therefore six key areas where reform could help to make Ukraine's road towards European integration a far smoother one. But there are of course many other important examples that could be added, including the business climate and co-ordination of assistance.

Ladies and gentlemen,

The completion of talks on the Association Agreement has made it clear that the overall direction of EU-Ukraine relations is towards closer integration and association. Therefore, we now expect Ukraine to play an active role in the Eastern Partnership, which aims to pursue these goals. I hope this will be a year when Ukraine benefits from the EaP in full.

A key actor in advancing this, both in the region and in Ukraine, is Civil Society. Civil Society is important due to the concrete steps it takes, but to be effective Ukraine must introduce adequate legislation on NGOs, so that they do not face unnecessary administrative obstacles. The Ukrainian government needs to strengthen its dialogue with Civil Society because this increases the democratic credentials of the reform process.

Now is the moment for Ukraine to choose the path that it will take to reach this destination, and to show that it is serious about preparing the ground for full implementation.

Thank you.

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