Spotlight: Visa-free travel with EU implies new opportunities, challenges for Ukraine

Representatives of the European Parliament and the European Council on Wednesday have signed an agreement finally approving a long-delayed liberalization of visa regime for Ukraine.

Without a doubt, the new travel rules, which will come into force in mid-June, will bring new opportunities for the Ukrainian people, but some experts believe that the new travel rules also may pose challenges.

NEW TRAVEL RULES

Under the liberalized visa regime, negotiations have been started since 2008, Ukrainians who hold biometric passports will be able to enter the European Union (EU) without a visa for 90 days in any 180-day period.

The new rules apply to all EU countries, except Ireland and the UK. Ukrainians will also be able to access non-EU countries -- Iceland, Liechtenstein, Norway and Switzerland without a visa.

The eased travel requirements would benefit around 3 million of Ukrainian biometric passport holders and nearly one million of other Ukrainians, who plan to receive the documents in the nearest future.

The visa waiver will exempt the holidaymakers from difficulties associated with receiving the visa, such as travelling to another city to get the travel permission or standing in large queues in the embassies.

Besides, it would save the money for Ukrainians, who now obliged to pay a visa fee of 35 Euros (about 39 U.S. dollars) per a Schengen visa and additional service fees charged by the travel agencies or visa application centers.

However, the visa liberalization does not mean the unhampered travel. After the introduction of the new regime, Ukrainian citizens would have to present a set of supporting documents to the border guards to enter the EU.

Local experts suggested that low level of awareness among Ukrainians about the needed documents may provoke cases of refusal of entry into the EU at the border checkpoints.

"We believe that under the visa-free regime, the rate of refusals in the entry may increase, primarily because some Ukrainians are not fully aware of the visa-free rules," said Ekaterina Kulchytska, an analyst at the non-government organization "Europe without barriers."

TRAVEL MARKET RESHAPE

Despite the widespread view that the Ukrainian tourism sector will reap huge benefits from the liberalized visa regime, some local experts believe that the new rules would just reshape the travel market.

Shortly after the visa waiver announcement last month, travel companies have recorded a robust growth in the bookings to Europe. However, the increased demand was recorded primarily in the low-price segment.

"The demand has increased mostly for inexpensive package tours, in particular, excursion bus tours to Europe, where visa fees represent a large percentage of the price. Also, we expect a high demand for last-minute tours, where a valid visa is a prerequisite," said Julianna Jovbak, the head of "Voyage" travel agency.

The liberalization of the visa regime will also spur the demand for affordable summer beach destinations, such as Bulgaria and Romania, she said.

In the same time, Jovbak said the middle-class Ukrainian tourists, who used to travel to Croatia, Spain and Greece, will abandon the services of travel agencies after the introduction of the visa-free travel.

"Previously, they booked tours in the travel agencies, because they didn't want to bother about preparing visa documents. Now, they will buy tickets and make reservations online. Only large tour operators (working in the segment) will survive, small ones will close," said the head of the travel agency.

She suggested that luxury segment of the Ukrainian tourism market will not be significantly affected by the visa waiver.

IMPACT ON ECONOMY

The visa liberalization will also affect the Ukrainian economy, with positive effects on certain areas and negative on others.

First of all, the abolition of visas will make it easier for small and medium-sized businesses to search for partners in the EU countries, participate in the exhibitions and business forums in Europe.

In addition, it will spur the domestic demand, leaving about 60 million dollars annually spent by Ukrainians on paying visa fees inside the country.

The revitalization of the transport sector is another benefit from the visa liberalization, experts believe.

"Visa-free regime means the elimination of transport barriers and cheaper tickets. Right now, there is an active process of European low-cost airlines entering Ukraine," said Olexandr Sushko, a research director at Institute for Euro-Atlantic Cooperation.

According to local experts, Ukrainian bus transportation market would grow by between 10 percent and 20 percent once the visa-free regime takes effect.

However, there are businesses, which would fall victims to the new travel rules. First of all, it concerns dozens of the visa application centers across Ukraine providing intermediary services in obtaining visas.

Besides, the visa-free entry to the EU may affect the sector of domestic tourism -- many Ukrainian holidaymakers would choose travelling to Europe instead of spending in their home country. Endit