Ukrainian Economy between East and West
Deep and Comprehensive Free Trade Area with the European Union versus Customs Union with Russia, Belarus and Kazakhstan
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In the world of rapidly growing global liberalization, the issue of the relationship between international trade and economic growth has become increasingly important. While the benefits of trade creation are widely recognized among economists and policy makers alike, the growing proliferation of regional trade agreements (RTAs) has led to a debate on the impacts of RTAs on their member countries. As far as Ukraine is concerned, two main options of regional economic integration are on the agenda: the establishment of a Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU and the par...
In the world of rapidly growing global liberalization, the issue of the relationship between international trade and economic growth has become increasingly important. While the benefits of trade creation are widely recognized among economists and policy makers alike, the growing proliferation of regional trade agreements (RTAs) has led to a debate on the impacts of RTAs on their member countries. As far as Ukraine is concerned, two main options of regional economic integration are on the agenda: the establishment of a Deep and Comprehensive Free Trade Agreement (DCFTA) with the EU and the participation in the recently formed Customs Union between Russia, Belarus and Kazakhstan (CU RBK). While it is possible for a country to participate in several regional trade agreements at the same time, Ukraine appears to be in a unique situation where a full membership in CU RBK is incompatible with the free trade regime of the DCFTA. Although entry into both RTAs would be the best solution,Ukraine s current situation forces the country to make a strategic choice of which partner to ally with. The objective of this work is to provide a holistic analysis of both RTAs and their potential impact on the economy of Ukraine in terms of economic growth and other related aspects.
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