Ukraine’s trade policy in Asia under multipolar globalization

Abstract

The article defines the directions of Ukraine’s trade policy under multipolar globalization, which assumes that the centers of development and trade are concentrated both among developed and developing economies. The article analyzes the development of Ukraine's trade with the leading economies of Asia - China, India, Japan and the Republic of Korea, which have created a powerful pole of world trade in Southeast Asia. However, domestic exports to these countries are developing unevenly and at a moderate pace. The latter is explained by the specific features of the trade regime of these countries, primarily the high level of non-tariff market protection. Domestic exports to Asian countries remain extremely undiversified with the predominance of one or two goods in the structure: mainly ores and corn are exported to China, to India - sunflower oil, to Japan - ores and tobacco products, and to Korea - corn and wheat. Estimates of the volume of trade in domestic goods after the full-scale invasion of the Russian Federation into Ukraine show that in the first half of 2022 alone, the exports to Asian countries decreased by 49%, and the imports decreased by 20%. It is assumed that by the end of 2022, the volume of foreign trade turnover between Ukraine and the People’s Republic of China may decrease by an average of 32.9% compared to 2021, India – by 41.9%, Japan – by 26, 6%, and Korea – by 28,5%. Diversification of commodity exports with an emphasis on goods with a higher share of value added is defined as an important direction of trade policy in relation to the leading countries of Asia. In particular, prospective agricultural export products to Asian countries are honey, chicken, dairy products, etc. Prospective industrial goods include inorganic chemical products, fertilizers, wood products, nuclear reactors, etc. Recommendations for improving Ukraine’s trade policy have been developed, and the need is substantiated to conclude free trade agreements in order to further develop Ukraine’s trade with leading Asian countries. Also, the need to abandon the idea of negotiating a free trade agreement and investment agreement with China has been proven. The article analyzes the policy of economic patriotism pursued by the Indian government, in particular as a response to the full-scale invasion of the Russian Federation into Ukraine. The authors note India’s disagreement on issues of opening markets for sensitive agricultural products, which causes the complexity and delay in the negotiations on free trade with this country. Access to the markets of Japan and the Republic of Korea is complicated by the high level of tariff and non-tariff barriers. However, the analysis of the trade policy of these countries shows that a significant part of markets of both agricultural and industrial goods in these countries were opened due to the numerous FTAs. It is recommended to initiate negotiations on free trade with Japan and the Republic of Korea in order to improve Ukraine’s competitive position in the markets of these countries.