In 2014, Polish-Ukrainian trade exchange has slowed down substantially. In the first half of the year, turnover fell by 10 percent compared to last year and amounted to 3.3. bln USD. Export of Polish goods to Ukraine fell, while import of Ukrainian goods increased. In the first half of 2014, Polish investments in Ukraine decreased by 18.7 mln USD. – There are no indications that next year will bring positive developments; they can be expected in 2016 at the earliest – comments Agnieszka Mozyro-Skiba, Adviser to the President of Employers of Poland.
The extremely unstable situation in Ukraine deters Polish investors. Without international financial support, Ukrainian economy will break down, as evidenced by the warnings issued by the International Monetary Fund, a drastic decrease of Ukraine’s macroeconomic indexes, as well as dramatic calls for help made by Ukrainian leaders on the international stage. Removing duties and other restrictions on trade between Ukraine and EU states, which is included in the association agreements between Ukraine and the European Parliament, could improve Ukraine’s situation and Polish-Ukrainian trade exchange, but due to pressure from Russia, these facilitating solution will only be implemented in early 2016.
The volume of Polish-Ukrainian trade Exchange depends on decisions made by the governments. This year, Ukrainian authorities have made several decision unfavourable for Polish entrepreneurs, a.o. imposed an embargo on Polish in February and July (the ban on importing meat from the Podlaskie voivodeship is still in force), increased duties on Polish meat or introduced a ban on Polish livestock in Ukraine (on November 27th). In light of this, the export of Polish meat has become unprofitable, even if it is technically possible in isolated cases. Last year, Poland sold 19 thousand tons of pork worth a total of 33 mln euro to Ukraine.
However, Polish defence industry has an opportunity to increase trade with Ukraine, as solution facilitating the import of defence goods have been introduced there. The aim is to cut VAT and duty expenses related to exporting military good to Ukraine.
The coming year will be a very stern test for the Ukrainian state. The finances of the society are worsening and public opinion polls conducted by GfK Ukraine show a negative trend in consumer moods. This indication is confirmed by a decrease of 6.8 percent in retail and gastronomy turnover in October, compared to an analogous period of last year. What is more, since the beginning of 2014 the prices of consumption goods and services grew by 21.2 percent. In such conditions, one should not count on an improvement in Polish-Ukrainian trade turnover and without political good will only further decreases are to be expected.
Agnieszka Mozyro-Skiba, Adviser to the President of Employers of Poland