"Ukraine exits the free trade area with Russia, raises duties on all goods and puts a trade embargo on all food products manufactured in the Russian Federation, as well as on car building and engineering products," said Ukrainian Prime Arseniy Yatsenyuk, according to a statement released by the country’s government. "We are taking countermeasures. We didn’t start this war, meanwhile the aggressor will be punished.”
The ban came into force on January 10, and it is expected to remain in place until at least August 5, according to the Ukrainian government.
On January 1, the Deep and Comprehensive Free Trade Area (DCFTA) which forms part of the Association Agreement inked by Ukraine and the European Union in June 2014, entered into force. The free trade zone agreement has triggered opposition from Moscow which aims to disengage Kiev from its alignment with the EU.
Meanwhile, Ukrainian Minister of Agrarian Policy and Food Oleksiy Pavlenko said that the majority of products which are exported from Russia to Ukraine are made by local subsidiaries of major international groups. According to Pavlenko, the embargo placed by Kiev on Russian imports could encourage these companies to expand their manufacturing capacities in the Ukrainian market.
In 2014, Ukraine exported about $54.2 billion worth of products, of which 32.3 per cent were agricultural products. The EU remained the country's main trade partner, with 31.5 per cent of the total, followed by Russia which held a 18.2 per cent stake, according to data from the World Trade Organization (WTO).
The latest decision marks another tit-for-tat move in Ukraine’s troubled economic relations in Russia. Ten years ago, Kiev decided to ban Russian animal product imports after Moscow placed an embargo on imports of such products from Ukraine on January 20, 2006.
