UK signs historic trade deal with Ukraine as part of enhanced support

By Government of United Kingdom

UK signs historic trade deal with Ukraine as part of enhanced support

The UK signed a pivotal digital trade deal with Ukraine that will support the country’s economy and greatly enhance the UK-Ukraine trade and investment relationship. The Department for Business and Trade hosted a number of Ukrainian ministers, as well as 200 UK and international businesses and officials, at Mansion House to lay the foundation for closer future cooperation.

The Road to Ukraine Recovery Conference, geared towards supporting Ukraine’s National Recovery Plan and mobilizing UK businesses to engage in future Ukraine reconstruction projects, opened with a welcome from the Business and Trade Secretary. This event, and the mobilization of the UK industry, is a key stepping stone on the route to the Ukraine Recovery Conference that will be hosted in London in June.

Badenoch, alongside Ukraine’s First Deputy Prime Minister and Minister of Economy, Yulia Svyrydenko, virtually signed a ground-breaking new Digital Trade Agreement (DTA) that will help Ukraine support its economy through the current crisis and lay foundations for its recovery and revival.

Business and Trade Secretary Kemi Badenoch MP said: ”The historic digital trade deal signed today paves the way for a new era of modern trade between our two countries. We are also extending tariff-free trade on imports from Ukraine to early 2024, providing much-needed support to Ukrainian businesses. These initiatives will help protect jobs, livelihoods, and families now and in Ukraine’s post-war future”.

Since June 2022, UK negotiators worked at a record pace with their Ukrainian counterparts to deliver a deal after President Zelenskyy highlighted the important role Ukraine’s first-ever digitally focused trade agreement could play in bolstering his country’s economy.

Ukraine will have guaranteed access to the financial services crucial for reconstruction efforts through the deal’s facilitation of cross-border data flows. Ukrainian businesses will also be able to trade more efficiently and cheaply with the UK through electronic transactions, e-signatures, and e-contracts.

First Deputy Prime Minister and Minister of Economy for Ukraine, Yuliia Svyrydenko said: ”This digital trade agreement illustrates that Ukrainian IT companies operating in Ukraine are in demand around the world despite all the challenges of war. The UA-UK Digital Trade Agreement has enshrined core freedoms for trade in digital goods and services. Ukraine believes that an open and free framework for the digital economy is the best investment in future-oriented development”.

The UK’s total military, humanitarian, and economic support pledged since 24 February 2022 amounts to over £4 billion. The UK is a key partner for Ukraine in its reconstruction efforts. The UK hosted the UK-Ukraine Infrastructure Summit in June 2022, signed a Memorandum of Understanding (MoU) agreeing to play a leading role in the reconstruction of Kyiv Oblast, and set up the Infrastructure Taskforce to implement this agreement.

Stuart Senior, a Member of the Supervisory Board, Gleeds said: ”As international construction consultants, Gleeds has had a presence in Ukraine for many years. We welcome this new agreement which strengthens UK-Ukraine relationships and helps Ukraine’s increasing development as a modern, open economy. The DTA will remove barriers to digital trade and enable partnership initiatives and collaborative working to be delivered more effectively. It will also further enhance the acceleration of economic recovery through the faster delivery of critical infrastructure reconstruction projects by implementing better processes and standards”.

In the margins of the Road to URC event, the UK confirmed its intention to extend the removal of tariffs on Ukrainian products until March 2024. This follows the UK’s world-leading decision in May 2022 to cut tariffs on all goods from Ukraine to zero and will provide much-needed support to Ukrainian businesses given the impact of the war on Ukraine’s ability to export goods.

The UK also continues to support Ukraine through decisive sanctions against Russia. The UK and its allies have introduced the most severe economic sanctions ever imposed on a major economy, including £20 billion (96%) of UK-Russia goods trade from 2021.

Sanctions are having deep and damaging consequences for Putin’s ability to wage war. Since the start of the invasion, UK goods imports from Russia have fallen by 99% and goods exports to Russia have fallen by 80%.