OREANDA-NEWS. January 21, 2016. President, Honourable Members,

I am grateful for this opportunity to take stock of where we are more than one year since this House approved the Association Agreements with Ukraine, Georgia, and Moldova, followed shortly after also by the provisional application of the Deep and Comprehensive Free Trade Area with Ukraine.

For Ukraine the DCFTA can bring significant economic benefits. Ukrainian businesses will now receive stable and predictable preferential access to the largest market in the world with 500 million customers.

And, EU enterprises will be able to benefit from easier access to the Ukrainian market, though we must help Ukraine develop the right conditions to encourage new business and investment relationships. 

Over 20 meetings were held in trilateral format to address alleged Russian concerns  about the DCFTA implementation. Now Ukraine faces a number of measures imposed by Russia impeding trade and transit, and will need our support here too.   

In 2016 will be stepping up our efforts to support Ukraine with more co-ordination with EU member states and greater visibility for our work, particularly on implementation of the DCFTA. We will build on current support programmes to improve the business climate, provide support to small and medium-sized enterprises, and help Ukraine find new markets. Ukraine needs to show it is open for business by aligning with EU standards in key sectors and taking decisive action on rule of law. The Support Group for Ukraine is playing a key role with the Commission in all these areas.

Despite very challenging circumstances – the Ukrainian government has made progress in implementing the Association Agreement. The National Anti-Corruption Bureau and new national police have started to work. The selection process for an Anti-Corruption Prosecutor has been completed. The government has also adopted a law on the natural gas market, which aims at bringing the gas sector of Ukraine in line with the EU Third Energy Package.

These developments were welcomed at the second Association Council in Brussels on 7 December, but we should not underestimate the challenges ahead.

The fight against corruption, reform of the judiciary and of the public administration, as well as amendments to the Constitution, particularly the second reading on decentralisation, will require courage and political will.

Shortly before Christmas, we published our final report on Ukraine's implementation of the Visa Liberalisation Action Plan, which concluded that, since necessary progress had been made and a number of additional commitments undertaken by the Ukrainian leadership, a positive recommendation for visa-free travel could be made. We aim to present a legislative proposal to pave the way for visa liberalisation with Ukraine soon.

Turning to Moldova, the countryhas made great strides in concluding and implementing the Association Agreement and DCFTA with the EU. Since 1 January, the region of Transnistria also has the possibility to trade preferentially under the DCFTA, making an important contribution to our conflict resolution efforts.

But recent Moldovan governments have not implemented important reforms. We are currently witnessing a highly unstable political situation which is an obstacle also to the effective implementation of the Association Agreement and making full use of the opportunities.

The country is in great need of stable leadership, with the determination and energy required to address a number of problematic issues including high-level corruption. This is necessary before Moldova can proceed with other key reforms - in particular in the justice, financial and media sectors, and reform of the public administration.

Finally, as regards Georgia, impressive efforts have been made to implement the Association Agreement, and the results are already visible with strong growth in Foreign Direct Investment. Other indicators also show promising signs. The Visa Liberalisation Action Plan has proven to be an effective tool for promoting a range of reforms, but Georgia has gone beyond the Action Plan benchmarks and taken further steps to reform the judiciary as well as the prosecutor's office. The result was our positive report last December and with Georgia too we will press ahead now with legislation to achieve full visa liberalisation as soon as possible.

In summary, we can be happy that we have already come so far with our three Association Agreement partners but we still have a long way to go, and no room at all for complacency. I look forward to hearing the honourable members' views during the debate.