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Ukrainian Exports Hit Hard: War, Embargo, and Need for EU Support

FOOD & AGRICULTUREUkrainian Exports Hit Hard: War, Embargo, and Need for EU Support

The export of products from Ukraine is decreasing year after year, due to the destruction of production plants and transport routes. In relation to Poland, the decline is a result of the embargo on Ukrainian products introduced in April 2023. “However, let’s remember that last year we imported goods from Ukraine worth around 4.5 billion euros, while we exported goods worth about 11 billion euros,” emphasizes Dariusz Szymczycha from the Polish-Ukrainian Chamber of Commerce, adding: “I have the impression that in this whole discussion around the border and Ukraine, there is a lack of basic information and hard data, everyone operates on emotions.”

“Export since the first year of the war is the basis for financing a significant part of the Ukrainian budget. Unfortunately, this export is falling year by year, which is the result of the destruction of production plants and communication routes. Until the outbreak of the war, about 60% of Ukrainian exports passed through the Black Sea – today this sea is mined, Russia has withdrawn from the so-called grain corridor agreement, so these streams of goods have to go by land, also through Poland”, says Dariusz Szymczycha, First Vice President of the Polish-Ukrainian Chamber of Commerce, to Newseria Biznes agency.

In the first year of the war, Ukraine’s trade exchange collapsed – Ukrainian exports decreased by 35.1% and imports by 24.2%, due to factors directly related to the war (loss of territory, destruction in industry), as well as the fact that before its outbreak Russia and Belarus were important economic partners for Ukraine, especially in terms of importing fuels.

The main direction of Ukrainian foreign sales remains the European Union, which accounted for 65.6% of exports. They are followed by countries of the Middle East (13.8%) and Southeast Asia (10.5%). Importantly, in 2023, Poland retained its position as the most important recipient of Ukrainian goods in the world, despite a 28.6% decrease in imports (from 6.7 billion dollars in 2022 to 4.8 billion dollars last year), the main reason for which was the introduction of a ban on the sale of certain types of grains and oilseeds in April.

According to the expert, both the Polish government and the European Commission slept through the moment to solve this crisis.

“There is no doubt that Ukraine needs help. But the opening of agricultural product imports to the Union cannot be in the form it currently is. Polish farmers and those from other Union countries will not survive the competition. We need here and now greater protection of the EU market, as well as appropriate long-term mechanisms,” said Czesław Siekierski, Minister of Agriculture and Rural Development, during a meeting of the EU Council for Agriculture and Fisheries.

During the meeting, the Minister raised the need to compensate farmers as soon as possible for the costs they incurred in connection with the implementation of the Green Deal and the excessive influx of agricultural products from outside the European Union, including Ukraine. The support for farmers from these funds should come from both the EU budget and the national budgets. He announced that he will apply to the European Commission to pay compensation to farmers, and also to support from the EU budget the export of grain from EU stocks, including from Poland.

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