Ukraine to stop trade enquiries in WTO in return for Armenia's concessions

Ukraine has successfully settled its second dispute with South Caucasus countries. Armenia reduced excise taxes on Ukrainian alcoholic beverages and cigarettes to the domestic levels, the Ukrainian newspaper Komersant Ukraina says in an article entitled "Ukraine Smokes its Pipe of Peace".

In return for such concessions on the part of Armenia, Ukraine will stop inquires in the World Trade Organization (WTO).

"Although Ukraine has gained privileges on the Armenian market, the tax burden on its products will be relieved compared to third countries," the Ukrainian periodical says.

The newspaper learned yesterday of the Armenian government's December 2 decision on equalizing the excise taxes between Ukrainian and local Armenian alcoholic drinks and cigarettes.

"Taking into consideration the free trade agreement between Ukraine and the Republic of Armenia, we recommend that the State Revenue Committee under the Armenian Government reduce the excise taxes on Ukrainian alcoholic beverages to domestic levels," says clause 52 of Government's decision No. 47, the newspaper said.

It further states that a similar decision has been made for cigarettes, but it will be effective in 2011-13.

The author of the article finds that Ukraine sought for the equalization of tax rates as an attempt to avoid applying conflict settlement mechanisms in WTO.