Identifier
Created
Classification
Origin
06KYIV4576
2006-12-15 12:02:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Kyiv
Cable title:  

12/15 UKRAINE WTO UPDATE

Tags:  ETRD WTRO ECON PGOV UP 
pdf how-to read a cable
VZCZCXRO6312
PP RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHKV #4576/01 3491202
ZNR UUUUU ZZH
P 151202Z DEC 06
FM AMEMBASSY KYIV
TO RUEHC/SECSTATE WASHDC PRIORITY 0711
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEHGV/USMISSION GENEVA 0029
UNCLAS SECTION 01 OF 02 KYIV 004576 

SIPDIS

SENSITIVE
SIPDIS

GENEVA FOR USTR
STATE PLEASE PASS TO USTR FOR KLEIN/MOLNAR
USDOC FOR 4201/DOC/ITA/MAC/BISNIS
USDOC FOR 4231/ITA/OEENIS/NISD/CLUCYCK
STATE FOR EUR/UMB, EB/TPP/BTA, EB/TPP/MTA

E.O. 12958: N/A
TAGS: ETRD WTRO ECON PGOV UP
SUBJECT: 12/15 UKRAINE WTO UPDATE

REF: A. YARNELL-KLEIN EMAIL OF 12/13


B. KYIV 4531

C. KYIV 4415

D. KYIV 4315

E. KYIV 4304

UNCLAS SECTION 01 OF 02 KYIV 004576

SIPDIS

SENSITIVE
SIPDIS

GENEVA FOR USTR
STATE PLEASE PASS TO USTR FOR KLEIN/MOLNAR
USDOC FOR 4201/DOC/ITA/MAC/BISNIS
USDOC FOR 4231/ITA/OEENIS/NISD/CLUCYCK
STATE FOR EUR/UMB, EB/TPP/BTA, EB/TPP/MTA

E.O. 12958: N/A
TAGS: ETRD WTRO ECON PGOV UP
SUBJECT: 12/15 UKRAINE WTO UPDATE

REF: A. YARNELL-KLEIN EMAIL OF 12/13


B. KYIV 4531

C. KYIV 4415

D. KYIV 4315

E. KYIV 4304


1. (SBU) Summary: The Ukrainian Rada (parliament) this week
adopted another WTO-related law, on scrap metal and steel,
bringing the total number of adopted laws to 19 out of the 21
considered necessary for accession. Local media, however,
fueled by some GOU officials, are erroneously reporting this
law to be the last required for accession and the end of the
Rada's work. Ukraine's lead WTO negotiator recognizes the
need for one additional piece of legislation and some fixes
to laws already adopted, although he is somewhat less firm on
Ukraine's commitment to develop a framework for biotechnology
products. Treatment of U.S. beef and pork imports remain a
stumbling block for accession. GOU officials have promised
that trade will now flow, but Post is still awaiting clear
evidence that the restrictions on U.S. products have been
lifted. Ukraine signed a bilateral Market Access Agreement
with Taiwan on December 14; Kyrgyzstan is now the sole
remaining holdout, with no recent progress on these
negotiations. End Summary.


2. (U) This latest edition in a series of regular update
cables regarding the status of Ukraine's WTO accession (refs
B-E) covers the period December 11-15.

Outstanding WTO-related Legislation
--------------


3. (U) The Rada adopted (in final reading) one more
WTO-related law on December 13, bringing the total number
adopted to 19 of the 21 pieces of legislation thought
necessary for accession. The Rada passed the new law, "On
the Export Duty on Scrap of Ferrous and Non-Ferrous Metals
and Alloyed Steel," to replace an export ban on scrap metal
with negotiated export duties. As reported ref A, the
version that passed contained only ad valorem duty rates, not
minimum specific rates in price per kilo, and is scheduled to
come into force only on the January 1 that follows WTO
accession. President Viktor Yushchenko has already signed

seven of the 19 adopted bills into law.


4. (SBU) Ukrainian media outlets, citing the Cabinet of
Ministers press service and senior GOU officials, have hailed
the December 13 vote as the final required for accession.
Econ Counselor reviewed outstanding legislation with Valeriy
Pyatnytskiy, Deputy Minister of Economy and lead WTO
negotiator, on December 12. Pyatnytskiy recognized that,
contrary to media reports, the GOU would have to return to
one draft law -- "On Value Added Tax (regarding taxation of
agricultural enterprises)" -- that failed to pass in the Rada
(ref B). In addition, Pyatnytskiy admitted that fixes to
some of the adopted legislation would likely be necessary,
hopefully as one omnibus package to be worked out through
consultations with Working Party members. The Commercial Law
Development Program's resident WTO adviser told us he
believes the Law on Foreign Economic Activity, in particular,
will likely need additional changes.


5. (SBU) Econ Counselor also asked about the promised law on
biotechnology products. Pyatnytskiy noted that the GOU does
not formally link this law to accession, since it is a
bilateral commitment to the USG and not part of WTO
conformity. He also argued that the U.S. bilateral commits
the GOU to develop a biotechnology framework but not
necessarily to finish its work prior to WTO accession.

U.S. Beef and Pork Exports
--------------


6. (SBU) Pyatnytskiy reaffirmed the GOU commitment to allow
immediate import of U.S. beef and pork, and recognized that
trade must flow before discussion of a system audit can
continue. He tasked his team to follow up with the
Veterinary Service and locate the order the Service claimed
it had sent to Ukrainian port authorities regarding beef and
pork imports from the U.S. Ministry of Economy officials had
received no response from the Veterinary Service as of
December 15.


7. (SBU) Ambassador called Deputy Minister of Agriculture

KYIV 00004576 002 OF 002


Petro Verbitskiy, who oversees the Veterinary Service, to
follow up on December 14. Verbitskiy assured Ambassador that
orders had been sent to allow for imports of U.S. beef and
pork, and asked for a meeting to discuss remaining issues,
such as system audits. We plan to meet with Verbitskiy's
team the week of December 18, when we will again request a
copy of the alleged order to the ports, and we will emphasize
that no discussion of system audits can commence until the
USG sees evidence that trade is flowing freely. Post
understands that a trial shipment of U.S. beef liver,
previously denied entry to Ukraine, is expected to return to
Odessa port on or around December 26.

Concluding Bilateral Agreements: Taiwan Signs
--------------


8. (SBU) Ukraine signed a bilateral Market Access Agreement
with Taiwan on December 14. Kyrgyzstan is now the sole
remaining holdout who has not signed an agreement with
Ukraine. Pyatnytskiy told us there had been no progress with
Kyrgyzstan's bilateral; Ukrainian negotiators were
disappointed that the Kyrgyz Minister of Finance decided to
cancel his expected December 8 trip to Kyiv. Pyatnytskiy
told Econ Counselor on December 12 that he hoped to visit
Bishkek in the near future to continue negotiations.
Taylor