Ukrainian Prime Minister Arseniy Yatsenyuk has expressed "serious doubts" about Ukraine's long-running dispute with Australia in the World Trade Organization over tobacco packaging.
Since 2012, Ukraine has inexplicably challenged Australia’s right to adopt plain packaging on all cigarette brands, a step proven effective in reducing smoking and saving lives.
The case somehow survived the EuroMaidan Revolution and change of government with lobbying by the tobacco industry, but Yatsenyuk’s warnings suggest Ukraine’s obstructionist stance on public health could come to an end.
On May 20, the Coalition for a Smoke Free Ukraine staged a picket outside the Cabinet of Ministers in opposition to the tobacco industry, which has historically wielded strong control over a succession of corrupt Ukrainian governments.
Campaigners handed out more than 200 leaflets to educate politicians.
Andriy Skipalskiy, chairman of Advocacy Center Life, said they hope to reach Yatsenyuk or Economy Minister Aivaras Abromavicius, who can drop the challenge to Australia. “If they say this should be done, it will be,” he said.
Shortly after the protest, Yatsenyuk told Abromavicius to “understand this situation,” noting that Ukraine joined the dispute on obscure grounds.
Abromavicius said the subject has moved up his priority list.
“The ministry is certainly paying attention to the public’s concern regarding this WTO case. Since it involves a variety of stakeholders, including local industry, civil society and our WTO partners, we need our full attention to study the implications of any action at this stage. We are finalising our assessment of the appropriateness of this case, especially as the prime minister stressed the need to have a decision on this matter shortly.”
However, the minister in charge of carrying out this research will be Deputy Economic Development and Trade Minister Natalia Mykolska, who has previously supported the case against Australia.
The campaigners celebrated the “first-ever” message of concern, but expressed concerns about Mykolska’s appointment, stating that they will continue to monitor the process.
Member of parliament Hanna Hopko, who heads the Foreign Affairs Committee, welcomed Yatsenyuk’s statement. “It’s important for us to show that we value our relationship with Australia. There are lots of Australians advocating for Ukraine and this case has put them in a very uncomfortable position,” she said.
While acknowledging campaigners’ reservations about Mykolska, Hopka noted that “as an expert on the World Trade Organization and a patriot, she has to prioritize national interest and protect Ukraine from the tobacco industry, which is damaging our reputation abroad.”
Mykolska was one of four public figures prominently targeted at May 20 protest, which also listed Svitlana Zaytseva, Olena Zerkal and Valeriy Pyatnitskyi on a poster entitled “Tobacco Lobby In The Cabinet”.
Zaytseva is the current head of Ukraine’s Economy Ministry division on cooperation with the WTO. In March, she said during a Foreign Affairs Committee meeting that the case was justified on the grounds that Australia’s decision limited intellectual property rights and created barriers to trade.
Zerkal held the position of senior corporate affairs manager at British American Tobacco until her appointment as deputy minister of foreign affairs of Ukraine for the European integration in August.
Pyatnitskyi, an advisor to Prime Minister Arseniy Yatsenyuk and former deputy economy minister, has a longstanding reputation as a prominent lobbyist for tobacco companies.
Former Economy Minister Pavlo Sheremeta celebrated the news on Facebook, posting: “On Aug. 20 last year I resigned from the then-government because of a disagreement with deputy Pyatnytskyi who among other things instituted the, in my opinion, shameful dispute with Australia in 2012... finally today, the prime minister gave instructions to stop the argument against Australia.”
The legal intricacies of the WTO case had proven difficult to convey concisely, to politicians and the public alike. The initial challenge by Ukraine invoked three separate international agreements: the trade-related aspects of the Intellectual Property Rights Agreement, the technical barriers to trade agreement, and the General Agreement on Tariffs and Trade.
In the three years since Ukraine’s request for consultation was lodged, Honduras, Dominican Republic, Cuba and Indonesia have all filed similar complaints. Several other countries also requested to join the consultations, either in support of Australia or to observe a potentially historic case.
With more than 20 countries now involved, Ukraine alone cannot decide simply to stop the case. This had enabled tobacco lobbyists to argue that there was no option to withdraw the complaint. However, the government can remove itself from the proceedings, which Skipalskiy argues is an important diplomatic statement.
“To clean up our reputation and to show the international community that the government is taking a new approach to corporate corruption issues, it is possible for Ukraine to just step out of the campaign. This would send a powerful message, that the initiator of the consultations and court case is out of the game,” Skipalskiy said.
The Australian lawsuit distracted from other important issues for anti-tobacco campaigners, including legislation to move Ukraine one step closer to plain packaging itself.
“We recently initiated and are supported by members of parliament to register a new package warning, complying with the European directive to ban flavorings and make package labeling 65 percent warnings,” Skipalskiy said.
Australia recorded a 12.2 percent drop in tobacco consumption between December 2013 and December 2014, widely attributed to plain packaging. Britain and Ireland have already passed similar legislation, with several other EU countries set to follow.
Ukraine retains one the the world’s highest rates of cigarette consumption. Despite improvements over the past decade, nearly 30 percent of the adult population smokes, shortening lives considerably.