A UK - Ukraine free trade agreement will help to secure the UK's food security post-Brexit
The Chairman of the British Ukrainian Chamber of Commerce (BUCC) writes an open letter to the International Trade Secretary Dr Liam Fox calling for "a new free trade agreement between the UK and Ukraine as soon as possible".
The UK and Ukraine are strategic partners on both security and trade, and there is an opportunity to deepen these important ties with a new free trade agreement, bringing real benefits to our countries, as you have earlier observed at a BUCC Conference on the potential benefits of UK-Ukraine free trade.
I know from discussions in Ukraine that the Ukrainian Government is willing to act very quickly to get an agreement in place. As we move towards Britain’s exit from the EU, developing close trading links with strategic partners like Ukraine should be paramount to Britain’s continued economic success.
This new trade agreement would have the following five major benefits.
A win-win for both sides
The financial benefits of a UK-Ukraine trade deal outside of the EU will create a win-win situation for both countries. For example, the UK imports more than half of the food we consume, while Ukraine is a leading food exporter. A bilateral trade deal tailored to each country’s needs, without compromises to protect other members of a wider economic bloc, will bring direct benefits to both sides.
Food that compromises on cost, not quality
Ukraine is the ‘breadbasket’ of Europe, with a third of the world’s finest black soil, based on which it is the world’s second largest grain exporter (wheat, corn and barley). As it builds leading food technologies, Ukraine is increasingly a high-quality producer with efficient production costs. Brexit gives the UK the opportunity to achieve significantly cheaper food prices by negotiating trade deals with major food producing countries such as Ukraine.
Delivering UK food security
For the UK to link with greater, but less expensive, sources of food located near the UK, like Ukraine, also addresses a fundamental, long-term problem, which is the UK’s need for food security in a world where, in the not very distant future, the world is expected to no longer produce enough to feed everyone. Food shipments to the UK by truck and rail from Ukraine can arrive in days.
An easier trade deal to negotiate
Ukraine is a largely agrarian based economy with food products constituting its principal exports, so the UK’s negotiation of better trading terms than under the EU’s DCFTA with Ukraine should be relatively straight-forward, quick and impactful.
Enhances UK export of services and manufactured goods into Ukraine
Ukraine represents a significant market of 43 million people and, as the country recovers from the effects of the conflict on its eastern border, the demand for greater imports of the UK’s financial, legal, accounting and other services, as well as UK manufactured cars and other goods, should rapidly grow under a new agreement facilitating trade.
Time is of the essence. We look forward to your securing a joint statement for trade between the UK and Ukraine as soon as possible.
Bate C Toms is the Chairman of the British Ukrainian Chamber of Commerce (BUCC)