Brussels–The European Union’s support for Ukraine risks teetering on an issue that was also at the center of discussions by the heads of state and government of the 27 member countries last week at the European Council. The Belgian rotating presidency of the EU Council decided this morning (March 25) to postpone the vote on the provisional understanding with the European Parliament on stopping tariffs on food imports from Ukraine until Wednesday (March 27) for “further consultations” between governments, several sources in Brussels confirmed. There are fears of a rejection that would not only jeopardize an annual economic benefit for Kyiv of 1.7 billion euros (until June 5, 2025) but, more importantly, would undermine the Union’s credibility in supporting Ukraine even on the economic-agricultural front in the face of the new Russian offensive. 
First scheduled for today – after giving the 27 EU leaders time to discuss the issue at the summit last Thursday and Friday (March 21-22) – the Committee of Permanent Representatives (COREPER) meeting was postponed for two days in the face of the uncertain situation. What senior officials report is that “several delegations” did not “clearly” articulate their position, and that is why additional time was needed to “explain” the interim agreement reached last Wednesday (March 20) with negotiators from the European Parliament. The reason for the delay was, in particular, that three EU member states – France, Poland, and Hungary – raised objections on two specific issues: first, on the reference year for triggering the ’emergency brake’ in the event of market disruptions in the Union (or just one of its members) and second, the inclusion of wheat in the list of products considered for measures to protect European farmers. Coupled with this is the risk of alignment – even partial – by other governments, including Italy, over concerns about potential impacts on the European agribusiness sector over the coming year.
Despite the debate among the 27 leaders at the European Council, the “concerns in principle” of the three countries involved remain, although all sources say the new proposals were “welcomed.” The opposition from Paris, Budapest, and Warsaw would not jeopardize the go-ahead for the deal (a qualified majority is required). However, it is necessary to look at the other undecided countries, like Italy, as they could create a blocking minority that makes the deal fall through. The Italian government reportedly voted in favor of the deal today but asked only for a change in the base year on import volumes of Ukrainian products to trigger the ’emergency brake’ (from 2022-2023 to pre-war 2021). The balancing point for Rome would be to protect national and European interests at the agricultural level while not failing to support Ukraine in terms of economic benefits.
It is one of the most sensitive points in seeking compromise in the Council. According to reports in Brussels, in case of a watered-down agreement, Kyiv would lose 1.2 billion euros compared to the European Commission’s initial proposal: compared to the 2 billion annual benefits calculated by the Commission, sources report that with what emerged from the trilogue between the EU Parliament and Council it would drop to 1.7 billion, but with the demands of France, Poland, and Hungary it could reach 800 million. Including wheat would be worth about 700 million, while the change in the base year is worth 200 million. This is the starting point of the new consultations between the Belgian presidency, the three most cautious governments, and the other undecided ones to arrive on Wednesday at a green light that would not jeopardize Ukraine’s economic revenues in a crucial year for the fate of the conflict with Russia.
What does the agreement on the extension to the Ukraine duty stop provide
The Commission’s proposal for the second extension to imports from Ukraine with a series of new measures in the event of “significant disruptions” to the EU market came in late January to (unsuccessfully) anticipate the strong protests of European farmers. The trilogue between EU Parliament and Council negotiators became necessary after MEPs at the March plenary session introduced amendments to the Commission’s proposal that the Council did not support. What emerged from the trilogue is a renewed Regulation that will apply from June 6 – subject to approval by both EU institutions – that extends the suspension of duties on Ukrainian exports to the Union and, at the same time, allows the Commission to take action within 14 days (no longer 21) to trigger automatic safeguards in the event of market disruptions.
The ’emergency brake’ was strengthened on agricultural products that are “particularly sensitive” – namely poultry, eggs, and sugar – taking into account “any negative impact on the market of one or more member states” and not just the EU market as a whole. In addition, the list was extended to four more products – oats, corn, semolina, and honey – with the Commission’s commitment to strengthen monitoring of imports of wheat and other cereals (the first most sensitive point for the three member states in question). The reference period to activate the ’emergency brake’ is 2022 and 2023 (the second critical point), and this means that the European Commission will be obliged to reintroduce tariff quotas only if imports of poultry, eggs, sugar, oats, corn, semolina, and honey exceed the average volumes of the last two years.
