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EU deals could stoke growth, reform

By WTOP Staff

DAVID McHUGH
AP Business Writer

KIEV, Ukraine (AP) — Leaders from the 28-country European Union on Friday signed broad trade and economic deals with non-member countries Ukraine, Moldova and Georgia.

The so-called “association agreements” have been a focal point in the region’s turmoil. In Ukraine, deadly protests broke out this winter when the president decided not to sign the EU deal under pressure from Moscow. The protests drove pro-Russian President Viktor Yanukovych from office, but drew the ire of Russia and pro-Russian militants in the country’s east.

Here is a look at the agreements and their likely impact.

PURPOSE: The EU uses them to increase trade and political cooperation with non-members. The document provides an extensive blueprint for adopting the same rules, standards and practices that apply in the EU.

TRADE: Most importantly, the agreements remove almost all tariffs on imports into the EU of goods and services. The aim is to increase trade, growth and jobs. The signing countries should benefit because the EU, with 506 million people, is a very large market to do business with, and because tariffs are being removed more quickly by the EU than by the signing countries.

REFORM: Beyond trade, the agreements set out a broad reform agenda to modernize the economies of all three countries and increase business investment. The countries fell behind economically while part of the Soviet Union and its state-run economy, and are still lagging amid corruption, poor business climates and civil strife. The signers agree to adopt EU rules on government contracts, fair competition and the intellectual property rights on ideas and inventions. They also agree to strengthen the rule of law and independent courts. Adopting EU standards on products and food safety will protect consumers and make trade easier.

RUSSIA: As an alternative, Russia is holding out membership in a customs union with itself, Belarus and Kazakhstan. It has warned that if Ukraine signs the trade deal, it could lose its current free trade arrangement with Russia and face new tariffs on its products. It’s not clear how far Russia will go. Russian authorities have blocked some Ukrainian imports. Russia blocked wine imports from Moldova ahead of a summit in November, when the country was first expected to sign the deal with the EU but did not. Russia barred wine from Georgia from 2006 until 2013.

HOLD THE GARLIC: Although most trade is being opened up, the EU kept in place restrictions on some agricultural products to protect its farmers from low-cost competition. Chickens from Ukraine and garlic from Moldova face import limits.

Ukraine won a 15-year transition period during which it can use tariffs to support its domestic auto industry from competition. Moldova will gradually eliminate protections for its dairy, pork, poultry and wine producers over 10 years.

NAME GAME: The agreement gives Ukrainian producers 10 years in which they can still use protected EU product names for alcohol such as Champagne and Cognac. It’s seven years for cheese names such as feta, Parmigiano Reggiano and Roquefort.

FOLLOW THROUGH: Further trade opening will depend on progress in actually implementing the new rules and standards, by passing them into law through parliament and then enforcing those laws. If countries fail to follow through, progress could stall — and that’s not an unrealistic fear. Ukraine botched two aid deals with the International Monetary Fund in 2008 and 2010. Kiev pocketed the first payments of loan money and then did not follow through on reforms. The aid deals were cancelled and a third is just starting.

RATIFICATION: The EU has already lowered its tariffs on imports from Ukraine through Nov. 1 as a gesture of support. Since the agreement takes effect two months after ratification, Ukraine’s parliament must ratify by late August and send the ratification documents to Brussels before the end of the month.

Otherwise, the tariffs will go up again Nov. 1 temporarily until Ukraine’s lawmakers ratify the deal.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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