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Kyiv welcomes EU plans to abolish tariffs as war devastates Ukraine economy

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By Euronews  with AFP
Smoke from an oil refinery rises over a field of sunflowers near the city of Lisichansk, Luhansk region, eastern Ukraine on July 26, 2014.
Smoke from an oil refinery rises over a field of sunflowers near the city of Lisichansk, Luhansk region, eastern Ukraine on July 26, 2014.   -   Copyright  AP Photo/Dmitry Lovetsky   -  

Kyiv has welcomed the European Union's proposals to abolish tariffs for some Ukrainian products including food as the Russian attack on the country is expected to devastate the economy.

President Volodymyr Zelenskyy said he discussed the proposals, unveiled by Brussels on Wednesday, with Commission chief Ursula von der Leyen.

"We will be able to save as much economic activity as possible in Ukraine and our national production," he wrote on his Telegram channel.

Bilateral trade between the EU and Ukraine amounted to €52 billion in trade last year, according to Brussels, a figure that has doubled since 2016.

But since the end of February and the Russian invasion, Ukraine's agricultural and industrial production has been hit hard, as well as its trade relations with the rest of the world, with the country's access to the sea blocked by the Russian navy.

Valdis Dombrovskis, EU Commissioner for Trade told Euronews on Thursday that the package is "a measure to support Ukraine's economy because there are estimates like World Bank estimates that Ukraine's economy due to the war will shrink some 45% this year".

"It's a devastating impact, not only from a humanitarian point of view, but also from an economic point of view," he added.

The proposal still needs to be approved by the European Parliament and the 27 EU member states.

The United Kingdom had already announced on Monday that it was lifting its tariffs on products imported from Ukraine.

Food and drink was Ukraine's primary export to the EU in 2021, followed by chemicals, raw materials, and other manufactured goods, according to Eurostat.

Ukraine, together with Russia, were commonly referred to before the onset of the war, as the breadbasket of the war as they are respectively the fifth and first largest exporter in the world of cereals such as wheat, corn and barley. Ukraine is also a big exporter of sunflower oil.

Kyiv banned the exports of certain food products in March, including wheat, corn and sunflower oil, in a bid to stave off shortages at home as the implementation of humanitarian corridors appeared difficult. It has since accused Russia of targeting agricultural and logistic infrastructure so it is unlikely the EU will import food form Ukraine.

"Unfortunately, we are seeing that Russia is pursuing hunger as a weapon of war. They are deliberately burning down Ukrainian food storage. It's also agricultural facilities. So clearly we must help Ukraine also in this regard because the sea routes are blocked by Russia. So Ukraine cannot export through its ports," Dombrovskis told Euronews.

"So we are now strengthening the capacity of the land routes so that Ukraine can export through this. And we are also simplifying the procedures, customs and other administrative procedures for transport companies to be able to step up the volumes of exports not only to the EU but also through the EU to other countries," he added.

The EU is expected to approve a sixth round of sanctions against Russia next week over its invasion of Ukraine which should include measures targeting the oil sector. EU energy ministers will meanwhile meet on May 2 to discuss Russia's decision to cut gas supplies to Poland and Bulgaria.