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12 member states raise 'serious concerns' about EU deal on Ukrainian grain, reigniting controversy

Many developing countries around the world rely on Ukraine's low-cost grain, whose trade has been upended by Russia's invasion.
Many developing countries around the world rely on Ukraine's low-cost grain, whose trade has been upended by Russia's invasion. Copyright Efrem Lukatsky/Copyright 2022 The AP. All rights reserved
Copyright Efrem Lukatsky/Copyright 2022 The AP. All rights reserved
By Jorge Liboreiro
Published on Updated
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The temporary measures under the EU deal relate to the trade of four Ukrainian products: wheat, maize, rapeseed and sunflower seed.

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A group of 12 European Union countries, including Germany and France, have raised "serious concerns" about a recent deal on the transit of tariff-free Ukrainian grain, reigniting a political controversy that Brussels had hoped was under control.

The deal was struck last month after Poland, Hungary, Slovakia, Romania and Bulgaria complained that an influx of Ukrainian cereals was fostering unfair competition and depressing prices for local farmers.

Talks with the European Commission led to a temporary arrangement under which four Ukrainian products – wheat, maize, rapeseed and sunflower seed – are allowed transit through the five Eastern countries but without being stored in their territory or being purchased for domestic consumption.

This solution is now being challenged by a larger group of member states, who believe the deal is at odds with the bloc's commercial rules, lacks transparency and requires further consultations. The governments also enquire about the potential impact the deal might have on markets beyond the East.

"We are in favour of finding European solutions to take account of the difficulties encountered by certain member states. However, the integrity of the internal market cannot be an adjustment variable," the 12 countries wrote in a joint letter addressed to the European Commission and seen by Euronews.

"The measures adopted on 2 May by the Commission without consulting the (other) member states, related to the selective limitation of imports from Ukraine, raise serious concerns because they lead to differentiated treatment within the internal market itself," the letter goes on.

"(The measures) also raise questions about the future treatment of cases of a comparable nature or scale that could be raised by one or more member states."

The letter is signed by the agriculture ministers of Austria, Belgium, Croatia, Denmark, Estonia, France, Germany, Greece, Ireland, Luxembourg, the Netherlands and Slovenia, and is dated 10 May.

France led the collective initiative.

"At the very least, clarification is needed as to how these proposals and measures relate to the rules and operation of the internal market and the Union's commercial policy, in particular with regards to the EU's obligations towards Ukraine stemming from the Association Agreement," the letter continues.

"This lack of transparency is critical."

Reacting to the criticism, a European Commission spokesperson confirmed on Friday the executive had received the letter and planned to respond "in due course."

"We felt there were very clear arguments to act in order to provide support to the farmers that were affected by this bottleneck," the spokesperson said, defending the temporary deal.

"It is important for us that the flow of agricultural products from Ukraine continues. It's very important for us to ensure that Ukraine can continue to export its grains."

On the question of transparency, the spokesperson said all 27 member states had been informed about the grain deal before its official adoption.

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A temporary deal under scrutiny

The deal struck late last month between the European Commission and the five member states in question — Poland, Hungary, Slovakia, Romania and Bulgaria — came after four of them had imposed unilateral bans on a wide import of Ukrainian cereals and other foodstuffs.

They argued the influx of goods, which are being exempted from tariffs as part of the EU's support to the war-torn nation, were distorting their domestic markets, filling up warehouses and bringing down prices for local farmers – a key demographic in elections.

The Commission, which was caught off guard by the bans, initially decried the move as "not acceptable" and underlined the so-called "solidarity lanes" were essential to provide an alternative avenue for Ukrainian grain to reach developing countries, as the traditional Black Sea route remains under the tight control of Russian forces.

Brussels then launched negotiations to design an EU-wide solution that could replace the uncoordinated national responses and offer some degree of certainty to Ukrainian businesses.

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After almost two weeks of talks, the parties struck a temporary deal on four Ukrainian products considered to have the most disruptive effect: wheat, maize, rapeseed and sunflower seed.

Under the agreed terms, the selected products are allowed transit through the five Eastern European countries but cannot be stored in their territory or purchased for domestic consumption. Instead, they are being sent directly to other member states or shipped around the world.

In essence, the solution constitutes a legalised ban but with a more targeted scope than the ones previously imposed on Ukrainian exports.

The deal also comes with a €100-million support package for affected farmers in Poland, Hungary, Slovakia, Romania and Bulgaria, and a promise to closely monitor the market trends caused by other types of agri-food products.

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"It is imperative that the criteria used to propose the amount of the €100 million package, as those used to allocate it among member states, are explained as soon as possible," the joint letter says.

The only-transit provisions are meant to expire on 5 June, when the tariff-free regime for Ukrainian trade is expected to be renewed for another year.

"At this stage, we cannot anticipate what will happen (after 5 June)," a Commission spokesperson said when asked about a possible prolongation.

"If we have the same scenario as we have now when we introduced the preventives measures, we're ready to consider introducing further measures."

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The joint letter marks the second time this week the grain deal is subject to criticism.

On Tuesday, Ukrainian President Volodymyr Zelenskyy slammed the checks during a joint press conference with European Commission President Ursula von der Leyen.

"Restrictions on our exports are absolutely unacceptable," Zelenskyy said.

"We expect that the relevant problematic issues will be monitored and that no decisions will be taken without consultations with Ukraine. We expect strong European solutions in that context and that all the restrictions will be removed as soon as possible."

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Speaking on condition of anonymity, a diplomat from one of the countries that signed the letter said the grain saga offered a preview of Ukraine's accession to the bloc.

"Imagine what will happen once Ukraine comes into the internal market," the diplomat told Euronews. "Then there is no way of protecting Polish farmers, not even through illegal unilateral measures."

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