Ukraine can't join Customs Union if signs association accord with EU - Putin
Ukraine's entry to the Customs Union is impossible if the country signs an association agreement with the European Union, but Russia will not interfere with Ukraine's decision, Russian President Vladimir Putin said.
"We in fact are neither 'for' nor 'against' Ukraine's signing an association agreement with the EU. This is not our business," Putin told a news conference in the wake a meeting of the Supreme Eurasian Economic Council in Minsk on Thursday.
Asked about whether Ukraine may join the Customs Union after it signs a cooperation agreement with the EU, Putin said: "No, this is impossible."
This option will become impossible because the association agreement paves the way for the creation of a free trade zone between the EU and Ukraine, and Ukraine, for its part, would assume an obligation to introduce the EU's trade rules and regulations on its territory, he said.
"Of the approximately 10,000 import customs tariffs, Ukraine will have to annul 7,600 tariffs as soon as this agreement comes into force, which should happen in February 2014," Putin said.
In a few years, "the Ukrainian market will be open [to European commodities] by 98.5%," the Russian president said.
"In our opinion, such an extent of market openness is increasingly dangerous for us and unacceptable at the current stage of our economic development," Putin said.
"We seek to establish a unified Eurasian economic space stretching from Lisbon to Vladivostok, but if we want to ensure a level playing field and avoid economic losses and, as a result, problems in the social sector, such measures should be agreed upon gradually," Putin said.
Ukraine plans to introduce the EU's technical regulations on its territory, "which means that most products manufactured in Ukraine will have to abide by the EU's technological standards," he said.
"These standards are very good, but in order to be able to follow them, the country needs to modernize its economy. It will require a large amount of investment. We have calculated it at some 100 billion euro. But where are its sources?" Putin said.
"Since Ukraine will not have full-fledged membership in the EU, it should not expect any loans and benefits. In our opinion, it might lead to a situation where Ukrainian commodities would be ousted from markets, primarily the market of the Customs Union," the Russian president said.
The Customs Union's member states also noted the fact that the Ukraine-EU association agreement recognizes so-called semi knock-down assembly as Ukraine's domestic product, he said.
Ukraine will also agree to liberalize its agricultural market, Putin said.
"It concerns both cattle breeding, livestock, meat products and plants. All of these items are a matter for very complicated and detailed talks. We do not participate in these negotiations and cannot simply accept all this and transfer this to Russian soil," Putin said.
The sides agreed to hold consultations in accordance with the rules set by the CIS Free Trade Zone Treaty, he added.
