Ukraine timber export ban impeding EUR 600 mln loan, official says

The only remaining impediment to Ukraine receiving a second loan tranche of 600 mln in macro-financial support from the EU is the country’s ban on timber exports, Ukrainian Euro-Integration Vice Prime Minister Ivanna Klympush-Tsintsadze said in a television interview on Jan. 12. The export ban violates Ukraine’s obligations with the WTO and EU Association Agreement, she said.

Despite claims by politicians, the export ban doesn’t solve the problem of deforestation since timber is being exported nonethless under different trade regimes, she said, adding that she doesn’t expect enough support in parliament to lift the ban.

Ukraine received the first installment of macro-financial support (EUR 600 mln) in July 2015. The disbursement of the next wire – out of the program’s total amount of EUR 1.8 bln – has since been delayed for more than a year.

Alexander Paraschiy: We expected the parliament would satisfy EU demands by December but it looks as though there’s too much populist gain for politicians to make off timber exports. We believe President Poroshenko has enough influence to force the vote through, but we can hardly predict when he will finally address the issue. Nevertheless, we expect the ban to be lifter sooner or later this year, which will clear the path to get the loan.