CBAM application to Ukraine can be discussed thorugh free trade zone negotiations, – FEU

In the near future, Ukraine and the EU will negotiate amendments to the free trade agreement. This process could include finding a compromise solution on the application of CBAM to Ukraine.

This was stated by Mykhailo Bno-Airiian, Chairman of the European Integration Committee of the Federation of Employers of Ukraine, at the roundtable “How CBAM will weaken the Ukrainian economy” held by GMK Center.

“Now we will start a cycle of negotiations with the European Commission on a possible revision of the free trade agreement. They do not want to extend the temporary trade measures regime and want to return to amending the agreement for now. It seems to me that the CBAM can be tied to this process and should be presented by the Ukrainian side in a comprehensive manner,” said Mykhailo Bno-Airiian.

According to him, the results of such negotiations will determine the future trade regime between Ukraine and the EU. And here it is very important for Ukraine to maintain the volume and continuity of trade.

“Dialogue should start now, and the CBAM issue should be discussed in this cQpert is convinced.

Currently, there is a transition period during which companies submit CBAM reports. Practice shows that all companies that have to submit reports have problems with it.

According to a study by GMK Center, the introduction of CBAM in the EU will lead to increased losses for the Ukrainian economy. Currently, more than half of Ukraine’s exports of goods go to the EU, and 15-17% of them may be subject to CBAM. If Ukraine loses $202 million in exports in the first year of full implementation of CBAM, this figure will increase to $1.44 billion a year in 2030.

At the same time, 93% of Ukraine’s exports subject to CBAM regulation are from the steel sector. The production of pig iron and long products will suffer the greatest losses from the CBAM.