This article was first published in the full version of the January issue of the Monthly Economic Monitor Ukraine (2017). It had been available for subscribers only. Its public full English version was first published in 4Liberty.eu
The new relationship between Ukraine and the European Union is the focus of this accessible, non-technical short guide. It is a summary of a longer Handbook entitled "Deepening Ukraine-EU Relations – What, why and how?"
The signing of the Association Agreement and DCFTA between Ukraine and the European Union in 2014 was an act of strategic, geopolitical significance in the history of Ukraine. Emblematic of a struggle to replace the Yanukovich regime at home and to resist attempts by Russia to deny Ukraine its ‘European choice’, the Association Agreement is a defiant statement of the country’s choice to become a democratic, independent state.
Ukrainian exporters surveyed by the IER’s Trade Facilitation Dialogue project say that inefficient and non-transparent value-added tax (VAT) refunds system and high levels of bureaucracy are the biggest obstacles for export. The survey also reveals that smaller enterprises tend to be more burdened by complicated customs procedures and lack of transparency in the operation of tax agencies. Furthermore, unpredictable trade policy of Ukraine is a more significant barrier for small and medium exporters than for bigger ones.
Ukraine is at vital crossroad, the current political situation is perhaps an ideal for the implementation of reforms. EuroMaidan resulted in a change of political regime. The change in power brought about a government far more dedicated to the creation of an environment favorable to business. Corruption, violation of property rights and excessive business regulation are key problems in the Ukrainian business environment.