EU and Ukraine sign free trade agreement

The European Commission has announced that the EU and Ukraine have concluded an association agreement. The treaty creates a so-called 'Deep and Comprehensive Free Trade Area' (DCFTA) that covers the territories of both the EU and Ukraine. The free trade area came into effect on January 1, 2016. From this date on, the EU and Ukraine will offer each other privileged access to their markets.

According to the European Commission, Ukraine's exports to the EU are mainly commodities of iron and steel, mining products, agricultural goods and, to a lesser extent, chemicals and machinery. In the longer term, the agreement is expected to support Ukraine's economic development and generate more demand for European products and services. In addition, the DCFTA offers good opportunities for modernizing Ukraine’s economy. With the agreement, an improved regulatory framework and easier access to the EU market is expected to increase trade and make Ukraine more attractive to European investors.

The EC also stated that for the EU Ukraine is a source of many raw materials. With 45 million consumers located next to the EU's border, Ukraine is also a high-potential market. Moreover, Ukraine is an economic bridge to other countries of the EU's eastern neighborhood.