“Hungary’s EU accession will create better trade conditions for Ukraine”

“The transition to US dollars in trade and severance of former industrial ties have caused the trade turnover between our states to shrink dramatically. Incidentally, when the Soviet Union was on its way to meltdown, annual trade turnover between Ukraine and Hungary totaled $2 billion, while in 1992 it barely exceeded $350 million. It is obvious that the changes placed the exporters of both states in a difficult situation. However, judging from the trade turnover statistics of the past decade, there is a discernible growth trend. In 2002, we have reached a trade turnover of $733 million, up 34.6% from 2001. Yet, we must admit that the current foreign trade volume between our countries does not reflect our potential. Simultaneously, the growth trend discernible in the past three years, especially in 2002, augers well. The turnover structure is also favorable. Our major exports are goods of the processing industry, machinery, and machine equipment, while our principal imports are raw materials, fuel, and basic materials. As for the turnover balance, it has been characterized by an import surplus for Hungary. We are interested in restoring the turnover balance by means of higher exports. Recent analysis of the economic and political processes in Ukraine suggests that Ukraine’s economy is growing. Fierce competition for solvent buyers and the need to maintain or increase one’s competitiveness force Hungarian businesses to work with increased effort.”

Hungary’s future membership in the EU and the fact that the EU will border on Ukraine require corresponding changes in the trade and economic sphere. After all, Hungary will adopt EU standards. What should be done to minimize the negative consequences of EU enlargement?

“We expect Hungary’s accession to the EU and the fact that Ukraine will be its immediate neighbor to cause drastic changes in our bilateral trade and economic ties. The vast enlarged market that will be soon joined by Hungary will impose new conditions on us all. We hope our foreign economic relations will develop more intensively, because our accession to the EU will result in the lowering of Hungary’s current industrial customs barriers to the considerably lower customs level of the EU. This will make the Hungarian market more open to Ukrainian goods. On the other hand, as an EU member, Hungary will do everything required of it to shape its foreign trade policy and means of developing trade so as to reflect the interests of our bilateral ties. Hungary’s joining the EU will be a challenge for Ukrainian businesses. Goods imported into Hungary will be freely sold throughout the EU with the help of the existing and future logistical and redistribution systems. In my view, we should use the existing opportunities as best we can.”

Kyiv and Budapest pay close attention to cross-border cooperation. Are the two countries satisfied with the current level of cross- border contacts?

“Last October, Lviv hosted an economic forum whose participants unanimously supported the intent to deepen regional cooperation. I remember stressing that joint Hungarian-Polish-Slovak efforts will do more to win EU financial support for cross-border cooperation. Hungary and Ukraine have reached an agreement to formulate a joint concept for the development of their border regions. This work is underway and we have seen considerable progress in the cooperation between Szabolcs-Szatmar-Bereg and Zakarpattia regions. This is also important because our joint efforts and projects will give us a greater chance to secure EU support for their implementation. As for our cooperation in the transportation sphere, we have extensive transport connections and are interested in developing all of their components. Among the East-West transport routes, the Fifth Pan-European Transport Corridor is particularly important for Hungary. We are interested in having the largest possible volume of goods traveling in the East-West direction transported via this corridor. It is extremely important for us to have the facilities and logistical services of the Zahony-Chop route used to the maximum. The completion of the Mukachevo-Zahony highway as well as Ukraine’s investment are expected to boost freight traffic. It is vital for both sides to agree as soon as possible on where this expressway will cross our common border.”