Archive for November 9th, 2011

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Shelving the DCFTA and AA?

November 9, 2011

Well dear readers, do you remember me saying “In the meantime I am led to believe that Ukraine is preparing to take a step back from the DCFTA and AA with the EU regardless, and may not be in a rush to initial these agreements anyway until there is more of a consensus within the EU over the prospects of Ukrainian membership in the future” in yesterdays post?

Well, yes it reads hideously today but I don’t edit what I write here.  What you see is the first and only draft.  If you want to read more carefully crafted work of mine that is more worthy of perusal then you pay – Cest la vie!

Anyway returning to this hideously constructed paragraph, I can now confirm that the essence of the paragraph is correct and that Ukraine is not demanding the initialing of the DCFTA and AA at the next scheduled meeting with the EU or even the one after that.

Pavlo Klimkin is now on record when commenting about the next EU/Ukraine meeting “For me it is not about  deliverables in a formal way.  We need a powerful statement that we have concluded all negotiations, but whether we initial it or not is less important.

So why the public cooling of momentum by Ukraine?  Firstly, the initialing of the DCFTA and AA is only a half-way step.  Ratification of these is what counts and Ukraine does not see a consensus amongst the 27 Member States that have to each individually ratify the agreement.

If the DCFTA was split off from the AA, in such economic times, there is little doubt that the DCFTA would be signed and ratified quite swiftly opening Ukraine’s 46 million potential customers to Europe and the EU’s 700+ million customers to Ukraine in a far more effective manner than now exists.

Undoubtedly there would be even more BMW’s, Mercedes, Bosch boilers, tulips from Amsterdam etc than there is now (and there are a lot already).  Ukrainians have $ billions quite literally under the bed, in wall safes or in boxes at home.  If the customs tariffs on BMW’s go down it is a sure thing there will be more BMWs driving around Ukraine for example.

The EU is not about to split the DCFTA off from the AA though.  To do that will remove a lever to influence the political scene in Ukraine.  That said, the AA is a completely ineffectual lever if it is not signed and ratified and Ukraine wants a statement of eventual Membership prospects in the AA agreement which not all EU Members are happy to do.

Even if that statement does get included, Ukraine is so far from reaching the Copenhagen Criteria that it would be decades before it could remind the EU of the paragraph it wants including in the AA.  The EU simply drawing attention to Article 49, whereby any European nation can apply to join the EU is simply not enough as far as the Ukrainian leadership is concerned.

Should this paragraph be included, one suspects Ms Tymoshenko could find herself released rather quickly as part of any deal for inclusion and the RADA suddenly find the political will to decriminalise the offence under which she was convicted.

What the Ukrainian leadership is looking for is something they can point to, in writing and within a ratified agreement, that will make all the pain of reforms required seem worth it as far as the end goal is concerned to the Ukrainian public.

A limp reference to Article 49 by the EU is not really enough to convince the Ukrainian public, particularly as they are now watching Greece become ruled by Brussels through an ever thinning veil of democracy and also watching Berlusconi in Italy being effectively toppled by an unelected and faceless market backed by Germany and France.

To be quite honest, if recent and on-going EU events are not enough to make both Ukrainian leadership and public alike think very carefully about ever activating any included promise of eventual membership, I don’t know what is.  Nevertheless, to help justify some popular and some very unpopular reforms required, a promise (even if never taken up) would help any Ukrainian leadership when it comes to what must be done and selling it to the voters.

The question for the Ukrainian leadership is therefore, once the DCFTA and AA negotiations are complete, is there any political mileage in simply initialing these agreements now for them to flounder on the rocks of ratification or should the negotiations be completed and then put on the shelf to await a time when there is a better chance of swift initialing and ratification?

Is half a step good enough to justify the reforms and public pain associated with them or is it better to wait until there is an EU consensus sufficient to take full step before such pain is inflicted?

In the meantime, what about the other options on the table with Russia, Turkey, Brazil et al which continue to be negotiated with varying media exposure?

For the EU, what merit is there in an EaP that does not contain the biggest populous or land mass?

How long will this be kept on the shelf if it is shelved by either side?  Certainly from what I am hearing Ukraine is rapidly cooling to the idea that this is a political “must do” in the immediate future and at any cost.  It seems current thinking is that if the final negotiated agreements sit on the shelf for a few months or even years that is not going to be the end of the world.

Some in Ukraine, like many of the rest of us, are looking at the EU in its current state of flux and is thinking WTF?

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