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EU and Ukraine

Volume 571: debated on Tuesday 3 December 2013

4. What recent discussions he has had with his European counterparts on the relationship between the European Union and Ukraine. (901371)

This was the main focus at the October Foreign Affairs Council. The decision to put on hold the signature of the EU-Ukraine association agreement is a missed opportunity. The EU’s door remains open. It is, of course, up to Ukraine to decide whether to walk through it and I strongly urge the Ukrainian authorities to respect the right of their people to express peacefully their views on this issue.

Does my right hon. Friend agree that the Ukrainian President’s recent decision not to sign the association agreement is doubly disappointing in that it would have brought great benefits to the Ukrainian people? What more can the European Union do to help Ukraine turn its back fully on its Soviet past and embrace a democratic European family?

My hon. Friend is right. Agreement on a deep and comprehensive free trade area would eliminate 99% of customs duties, in trade value, with Ukraine. That would save Ukraine about €500 million per annum. Economic analysts suggest that 6% would be added to Ukrainian GDP through more open trade with the European Union. The door will remain open and I believe that that message will be clearly communicated by all EU member states.

The situation in Ukraine is obviously intense and it is important that nothing is done by any outside parties to exacerbate it. Will the Secretary of State give some more information about what the UK Government are doing to try to get the negotiations back on course and to encourage the agreement with Ukraine to go ahead?

It is for Ukraine to make a decision about this. The advantages of an association agreement and a deep and comprehensive free trade area are self-evident. It is for the people of Ukraine and their Government to make a judgment about that. The door remains open, as I said a moment ago. We will continue to make that point to them, including in all our discussions with Ukrainian Ministers over the next few weeks. I think the rest of the EU will do the same, but in the end it has to be their decision and their judgment.

May I warmly welcome the fact that the door remains open, particularly in the light of the reaction of the Ukrainian people and the distinct possibility that there might be a change of policy or even a change of the Ukrainian Government themselves? Does the Foreign Secretary agree that the alternative would not only dash the hopes and interests of the Ukrainian people, but give a very serious boost to the dangerous ambition of President Putin to try to restore some form of Russian empire?

Clearly, it is open to Ukraine to change its policy. As my right hon. Friend knows, there is a great deal of discussion about that in Ukraine at the moment. Again, I urge the Ukrainian authorities to respect the right of peaceful protest and to investigate thoroughly why police violence was used several days ago. I believe it would also be in the long-term interests of Russia for Ukraine to have more open trade with the European Union. The sorts of economic benefits that I have said would flow to Ukraine would go on to benefit the Russian economy as well.

The Foreign Secretary said a moment ago that the benefits of this potential agreement are self-evident. The EU High Representative has described it as the

“most ambitious agreement ever offered to a partner country”,

yet, as we have heard, the Ukrainian President has refused to sign it. Will the Foreign Secretary set out a little more of what he believes were the main barriers to the deal being agreed and whether he still believes they can be overcome, given the external pressure on Ukraine?

One principal barrier was the pressure from Russia not to sign or make such an agreement with the European Union. As I have said, we disagree with that assessment even from Russia’s point of view. It would be in the interests of Russia and the whole of eastern Europe to have more open trade and co-operation with each other. We will go on setting out the advantages, but we will also look to Ukraine to clearly meet the criteria set out in the association agreement. Reliable studies have suggested that average wages in Ukraine would rise and that exports to the EU would rise by an estimated 6%. The arguments are very clear, but in the end it is for Ukrainians to make their judgment on them.

I am grateful to the Foreign Secretary for the candour of his last answer, which confirms the role that Russia clearly played in the events that unfolded at the summit. Reports suggest that the International Monetary Fund has a stand-by facility of between $10 billion and $15 billion to provide emergency financial support for Ukraine should Russia take steps to increase economic pressure on the country. Will he set out the British Government’s position on that stand-by facility, and say whether he thinks there might be circumstances in which it is appropriate to make it available to Ukraine?

If Ukraine is to make use of that facility, it is necessary for it to engage in important structural reforms. The reforms on which the IMF has made a new arrangement conditional would help to build a more stable and prosperous Ukraine, which again is important.

It is also important to note in passing that although this agreement has not been signed, deep and comprehensive free trade areas have been agreed between the EU and Georgia and Moldova, so parts of the EU’s Eastern Partnership have continued to progress.

Does my right hon. Friend agree that the first priority must be to put pressure on the Ukrainian Government to stop the shocking violence that has been committed over the last few days against the peaceful protesters currently in Independence square? Does he, however, take some encouragement from the stated commitment of the Government of Ukraine that they still wish to achieve, in due course, closer relations with the European Union, which is clearly the overwhelming desire of the Ukrainian people?

That does seem to be the desire of the majority of the Ukrainian people, so all hon. Members will of course hope that Ukraine is able to go in that direction. My hon. Friend is quite right to say that the first priority at the moment is to stress the need to allow peaceful protest. We have done that in the statements we issued at the weekend and in what I have said today. The incident at the weekend provoked domestic outrage and international condemnation, quite rightly, but we will keep the door open, as he and others have asked.