The European Union is against the initiative to introduce quotas on imports of mineral nitrogen fertilizers. This is emphasized in the response of the European Union Delegation to Ukraine to the request of leading agriculture associations, initiated by the All-Ukrainian Agri Council.

In particular, it is noted that under the multilateral rules of the WTO, precautionary measures are possible only if imports increase sharply and suddenly, and cause economic damage to local producers.

At the same time, the EU emphasizes that for many goods targeted by the investigation (the investigation of the Interdepartmental Commission on International Trade, initiated in August 2019), imports have actually decreased. And for some items of nitrogen fertilizers, the economic situation has even improved, so proposed measures would not be legally justified.

"Besides, the quotas offered by Ukraine are too restrictive. If the measures are introduced, they will have negative influence into farmers and artificially restrict competition in the Ukrainian market, which will lead to rising of local prices." - the EU said.

In its response, the mission also refers to a study by the Kyiv School of Economics, which confirms the negative influence of quotas on Ukraine's economy.

"It was estimated that the measures would cost farmers 174-509 million dollars and lead to losses in Ukraine's economy of 100-238 million dollars. Therefore, the EU is against the implementation of the measures proposed by Ukraine and will continue to express its concern" - the letter said.

We publish the official response of the EU Delegation to Ukraine:

Safeguard measures are possible under the multilateral WTO rules only if imports increase sharply and suddenly, and cause economic damages to domestic producers.

·      For many of the products targeted by the Ukrainian investigation, imports actually decreased. This is the case for some of the nitrogen fertilisers, and for the complex fertilisers for which, in addition, the economic situation of the Ukrainian producers even improved. Measures applied on these products would therefore not be legally justified.

·      Furthermore, the quotas proposed by Ukraine are much too restrictive. If measures are imposed, they would negatively affect particularly farmers, and artificially restrict competition on the Ukrainian market resulting in higher domestic costs/prices.

·      This has been recently confirmed by a study conducted by the Kyiv School of Economics which recommended that no measures should be imposed. It estimated that measures would cost farmers USD 174-509 million and lead to a loss of USD 100-238 million for the Ukrainian economy.

·     The EU is therefore opposed to the imposition of the measures proposed by Ukraine and will continue to voice its concerns.