Deepening trade ties between Ukraine and Europe can strengthen the shared resilience of both parties in a fragmented world, especially since Europe is Ukraine’s main trading partner.
According to Ukrinform, European Central Bank President Christine Lagarde stated this at the ninth Annual Research Conference “Economic and financial integration in a stormy and fragmenting world,” organized by the two central banks of Ukraine and Poland.
Lagarde traveled to attend the conference at the invitation of the National Bank of Ukraine.
She emphasized the importance of historical lessons, recalling that during the Cold War, the Iron Curtain fractured the European economy. As a result, trade between East and West fell by half and this division was like imposing a 48% tariff, she said.
“For Ukraine too, Europe is the principal trading partner, accounting for over 50% of its goods trade in 2024. By deepening economic ties – more closely linking neighboring economies – we can reduce our exposure to external shocks. Rising trade within our region can help offset losses in global markets. […] Regional integration strengthens resilience,” Lagarde said.
She pointed to the success of the EU’s eastern enlargement, noting that countries that joined the EU in 2004 have nearly doubled their GDP per capita over the past two decades. Between 2004 and 2019, the EU’s new member states saw their GDP per capita grow 32% more than comparable non-EU countries.
“The difference was deeper economic integration – and those that were already highly embedded in the regional economy gained the most,” she explained.
Lagarde also cited specific examples of how Ukraine is already integrated into European value chains. For example, Ukrainian firms already produce around 7% of all wire harnesses used in EU vehicles.
“As the industry shifts towards electric vehicles, which require more complex wiring systems, Ukraine’s manufacturing base is well positioned to scale up and play a larger role in the EU value chain,” she said.
As a second example, Lagarde highlighted Ukraine’s drone manufacturing sector, which has become one of the most advanced in the region. The country’s ambitious goal of producing 4.5 million drones by 2025 has accelerated innovation in materials science, battery technology and 3D printing.
According to Lagarde, these advances are already finding civilian applications in sectors such as logistics, agriculture and emergency response.
The ninth Annual Research Conference “Economic and financial integration in a stormy and fragmenting world” is taking place in Kyiv on June 19-20, 2025. Except for a forced break in 2022, the event has been organized annually by the National Bank of Ukraine in cooperation with the National Bank of Poland.
First photo: NBU
Source: Deepening trade ties can strengthen shared resilience of Ukraine, Europe – Lagarde
