Permanent Normal Trade Relations (PNTR) Status for Ukraine and U.S.-Ukrainian Economic Ties Page: 3 of 6
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The United States extended NTR treatment to Ukraine under the presidential waiver
authority beginning in June 1992 after the two countries signed and entered into force a
bilateral agreement as required under Title IV of the Trade Act of 1974. Since June
1997, Ukraine has received NTR status under the full compliance provision. Presidential
extensions of NTR status to Ukraine have met with virtually no congressional opposition.
Thus, for Ukraine permanent normal trade relations (PNTR) status is mostly symbolic
because its tariff status would not change.
While Ukraine remains subject to the Jackson-Vanik amendment, some of the other
former Soviet republics have been granted PNTR by the United States. For example
Kyrgyzstan and Georgia received PNTR in 2000. Most recently, Armenia received PNTR
in January 2005.
U.S.-Ukrainian Economic Ties
During the Cold War, U.S.-Soviet economic ties were very limited. They were
constrained by national security and foreign policy restrictions, including the Jackson-
Vanik amendment. They were also limited by Soviet economic policies of central
planning that prohibited foreign investment and tightly controlled foreign trade.
Since the collapse of the Soviet Union, Ukraine has struggled with shedding the
structures of a planned economy and building a market economy. These problems
hampered Ukraine's economic growth early in the transition period. In the last few years,
Ukraine's gross domestic product (GDP) has grown at fairly rapid rates, but many
observers contend that Ukraine needs to address problems with contradictory and
excessive government regulations and corruption if it is to reach its economic potential.
Ukraine remains heavily tied economically to Russia. It is highly dependent on
Russia for energy, and Russia accounts for around 18% of Ukraine's exports and 40% of
Ukraine's imports. However, Ukraine has been diversifying its trading partners. The EU
has become an important trading partner.2
The United States has encouraged closer economic ties with Ukraine since the
collapse of the Soviet Union. Along with granting conditional NTR status, the United
States has made government loan guarantees from the U.S. Export-Import Bank available
to U.S. exporters to Ukraine and has made insurance and credit programs from the
government-operated Overseas Private Investment Corporation (OPIC) available to U.S.
investors in the Ukraine.
Although increasing, U.S.-Ukrainian trade remains very small. In 2005, Ukraine was
the 78th export market for the United States and the 75th source of imports. It accounted
for about 0.5% of total U.S. exports and 0.7% of total U.S. imports in 2005. In 2004, the
United States accounted for about 3% of Ukrainian exports and 2% of Ukrainian imports.
In 2005, over half of U.S. imports from Ukraine consisted of steel and steel products plus
coke that is used in making steel. A sharp increase in U.S. imports from Ukraine in 2004
2 Economist Intelligence Unit. Country Risk Service: Ukraine. March 2005. P. 17.
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Permanent Normal Trade Relations (PNTR) Status for Ukraine and U.S.-Ukrainian Economic Ties, report, March 30, 2006; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc815846/m1/3/: accessed July 15, 2018), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.