The EU and Ukraine on Friday agreed to delay the implementation of their free-trade pact until the end of next year in a concession to Russia, which had complained its industry would be hurt by the deal.
Russia and the West are bitterly at odds over Ukraine, and the EU and the US both imposed new sanctions against Moscow on Friday over what they say is its military backing for separatist rebels in the east of the country.
Russia, which denies involvement, said it would consider retaliating.
However, postponing the entry into the trade deal helps address one of the issues at the heart of the crisis.
Russia had threatened to slap import tariffs on Ukrainian goods from Nov. 1, arguing that the pact would squeeze it out of the Ukrainian market and provide a route for EU goods to flood into Russia.
The delay provides “breathing space to discuss whatever problems may arise, and then it will be up to the three parties concerned to see what they do after Jan. 1, 2016,” EU Trade Commissioner Karel De Gucht told a news conference.
“I hope by then we come to a solution,” De Gucht said after talks in Brussels with Russian Economy Minister Alexei Ulyukayev and Ukrainian Minister of Foreign Affairs Pavlo Klimkin.
Ukraine will continue to enjoy privileged access to the EU market until that date, but, in a concession by Brussels, it will not have to cut duties on imports from the EU in return, he said.
Kiev had been concerned that allowing EU products more cheaply onto its market could undercut local goods, creating more problems for its weak economy.
The European and Ukrainian parliaments are expected to go ahead with ratification next week of the ambitious political and trade agreement that has been at the heart of months of upheaval in Ukraine.
Klimkin welcomed the agreement, saying: “We are very grateful to the European Union for the unique proposal of one-sided access to the European market.”
“It will allow our traders to very effectively prepare themselves for further trade liberalization,” Klimkin added.
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