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Putin
bans agricultural imports from sanctioning countries for 1 year
6
August 2014
A
one-year ban has been imposed on certain agricultural produce, foods
and raw materials from countries that have sanctioned Russia. An
order on economic measures to protect the country's security has been
signed by President Putin.
The
decree “on
the use of specific economic measures”
has been signed in response to sanctions imposed on Russia by a
number of states over the Ukrainian crisis, the Kremlin said on
its website.
While
the law comes into force immediately, the government has been tasked
to come up with a concrete list of imports to be banned.
The
decree orders the Cabinet to take measures to provide a balance on
product markets and prevent rapid price growth. The government has
also to join efforts with manufacturers, businesses and retail store
chains to increase the Russian goods supply.
Meanwhile,
ministers are already drafting a list of products that could be
affected by the ban and it can be ready already on Thursday, Natalia
Timakova, a press-secretary for PM Dmitry Medvedev told Vedomosti
newspaper.
The
register of the banned or restricted products will be flexible, a
source in the government told Vedomosti daily. It will include
different kinds of vegetables, fruit, and meat. However, wine and
baby foods will “definitely” not come under sanctions, the source
added. According to another government official, cheeses, meat, and
dairy products are those most likely be affected by the ban.
Last
week, the European Union approved a new (the harshest so far) round
of sanctions against Russia in addition to steps taken earlier. The
package targeted financial, energy and defense sectors of the Russian
economy. The so-called sectorial sanctions hit five Russian banks,
including the country’s biggest, Sberbank.
The banks were banned from raising capital on the EU’s capital
markets. Also, the EU introduced an embargo on the import and export
of arms and related material to and from Russia.
Speaking
on Tuesday, ahead of signing the decree, Putin stressed that Moscow’s
response should be “cautious.”
“Obviously
we need to do it cautiously in order to support domestic
manufacturers, but not hurt consumers,”
he said.
Reuters / Bogdan Cristel
Putin
described the political tools of pressure being used against the
Russian economy as unacceptable and added that they go against
international rules and norms.
A
day earlier, Medvedev said that Moscow would consider possible
responses to EU sanctions against Russian airlines.
Vedomosti
daily has been reporting Russia would limit European flights to Asia
that cross Siberia, in response to EU sanctions that caused Aeroflot
subsidiary, Dobrolet, to suspend flights on Monday. However, Foreign
Minister Sergey Lavrov said Wednesday the report was a baseless
rumor.
The
Russian Retailers’ Association gave an assurance that the ban on
agricultural imports will only affect the premium market segment, and
ordinary customers will not feel the impact. The group’s executive
director, Andrey Karpov told RIA Novosti that the association will
now reconsider the pool of foreign suppliers and increase the number
of Russian vendors.
At
the same time, Russia’s import limitations will not change the
European Union’s stance on Ukraine, the EU ambassador to Moscow,
Vygaudas UĊĦackas, told RIA Novosti.
Ouch!
European
farmers say Russian import ban may sting, EU says ‘Ukraine is top
priority’
RT,
6
August 2014
Russia’s
import ban on agricultural goods from countries that sanctioned
Moscow over the Ukraine crisis may have a negative impact on European
producers, farmers say. However, the EU’s ambassador to Moscow
insists the bloc's position will not change.
Russian
President Vladimir Putin signed Wednesday a decree imposing a
one-year ban on
agricultural produce, foods, and raw materials from countries that
have sanctioned Russia. The list of banned or restricted goods is
expected to be approved by the government later in the
week.
European agricultural businesses responded by saying they are worried that the Russian import ban may have serious negative consequences for them.
Finland may lose as much as 400 million euros (US$535 million) as a result of Russia’s retaliatory sanctions. According to Heikki Juutinen, the managing director at the Finnish Food and Drink Industries’ Federation, sanctions would be “very bad news” for his country, as about a quarter of Finland’s exports go to Russia, local Yle radio station reported. The situation may affect such big players as Valio – Finland’s biggest dairy producer.
European agricultural businesses responded by saying they are worried that the Russian import ban may have serious negative consequences for them.
Finland may lose as much as 400 million euros (US$535 million) as a result of Russia’s retaliatory sanctions. According to Heikki Juutinen, the managing director at the Finnish Food and Drink Industries’ Federation, sanctions would be “very bad news” for his country, as about a quarter of Finland’s exports go to Russia, local Yle radio station reported. The situation may affect such big players as Valio – Finland’s biggest dairy producer.
Finnish dairy industry could lose 400 million euros if Russia imposes...
“This
has the potential - and I stress potential - to become Economic
Crisis 2.0,” Prime
Minister Alexander Stubb told reporters in the Finnish city of Espoo,
Reuters quotes.
However,
Stubb also made clear the burden of retaliation had to be shared
among EU members: “If
sanctions hit Finland disproportionately, we will seek aid from our
EU partners.”
The
German Farmers’ Association (Deutscher Bauernverband) said the move
could cause an increase of supply on the EU’s internal market,
which, as a result, would put additional pressure on local
producers.
“Russia is an important market for our key export goods, primarily meat and dairy products,” said the group’s deputy head, Udo Hemmerling, as quoted by Itar-Tass.
“Russia is an important market for our key export goods, primarily meat and dairy products,” said the group’s deputy head, Udo Hemmerling, as quoted by Itar-Tass.
By
the end of 2013, the major importers of dairy products to Russia were
Finland, with 17.8 thousand tons worth US$19.6 million; Estonia, with
8.3 thousand tons worth $19.4 million; Poland, with 3.8 tons worth $8
million; and Lithuania, with three tons worth $7.3 million, according
to Russia’s Federal Customs Service.
‘Issue of secondary importance’
However,
Moscow’s retaliatory move will not change the European Union’s
position on Ukraine, the EU's ambassador to Moscow, Vygaudas UĊĦackas,
told RIA Novosti.
“Sanctions issue is of secondary importance in our relations. We’ve faced much more important and fundamental questions that must be addressed as soon as possible,” the diplomat said. UĊĦackas expressed hope that in the nearest future, Moscow and the EU will agree to take joint steps aimed at the de-escalation of the Ukrainian crisis.
“Sanctions issue is of secondary importance in our relations. We’ve faced much more important and fundamental questions that must be addressed as soon as possible,” the diplomat said. UĊĦackas expressed hope that in the nearest future, Moscow and the EU will agree to take joint steps aimed at the de-escalation of the Ukrainian crisis.
RIA Novosti / Yakov Andreev
“For now, no one can say exactly how much [European] companies will lose – too little details is known,”Mariani said, commenting on the news to RIA Novosti.
Western officials have been warning that a Russian import ban may hit consumers inside the country too.
According to Hemmerling, prices for pork in Russia have already increased significantly. “So Russian consumers will also have to pay for sanctions of their government,” he said.
However, Russian authorities assure that the import ban will not affect the country’s consumers.
Restrictions will only be imposed on products that Russia can produce itself or those “it can easily do without,” said Igor Rudensky, a United Russia MP who chairs the State Duma's Committee on Economic Policy. Shelves in the shops won’t be empty, he added, as cited by the ruling party’s press service.
Also,
the decision to prohibit products from a number of foreign countries
would stimulate Russian manufacturers, according to another MP for
United Russia, Irina Yarovaya. In her opinion, many producers of
“quality products” who previously could not make it to
supermarket shelves will now be able to sell their goods while
simultaneously developing their business.
RIA Novosti / Alexandr Kryazhev
“Opportunities to replace produce will be sought both within the country and in the countries that have not supported sanctions [against Russia],” Andrey Karpov, executive director for the Retail Companies Association, told Itar-Tass. Additionally, Russia's regional players may get a chance to increase their market share.
Russia’s agricultural watchdog Rosselkhoznadzor has already given the green light for 91 Brazilian suppliers of animal origin foods. The list of companies that are allowed on the Russian market has been published on the agency’s website. It includes 31 suppliers of beef by-products, 27 suppliers of poultry and beef, four companies that would import pork and pork by-products to Russia, and three dairy suppliers.
The final list of European and US products to be banned has yet to be discussed or confirmed by Russian Prime Minister Dmitry Medvedev. He is scheduled to review it on Thursday, according to Medvedev’s spokeswoman, Natalya Timakova. The preliminary list, disclosed by the Russian watchdog on Wednesday, is a “working draft,” Timakova said.
‘Very logical response’
Meanwhile,
EU sanctions against Russia have stirred up some critics, who argue
that Europe and its citizens will be the ones hurt by the move.
“It is no wonder that now there will be reactions and they will be very negative because there are Europeans who will pay the bills,” Anna van Densky, political commentator for EU Reporter magazine, told RT.
Moreover, the “adventuristic” EU sanctions were introduced without proper consultation with the European Parliament – the only institution directly elected by and accountable to European citizens – van Densky said. Instead of consulting the people, the European Council reportedly held talks with US President Barack Obama, she said, adding that there was a “dramatic lack of democratic basis in this decision.”
“It is no wonder that now there will be reactions and they will be very negative because there are Europeans who will pay the bills,” Anna van Densky, political commentator for EU Reporter magazine, told RT.
Moreover, the “adventuristic” EU sanctions were introduced without proper consultation with the European Parliament – the only institution directly elected by and accountable to European citizens – van Densky said. Instead of consulting the people, the European Council reportedly held talks with US President Barack Obama, she said, adding that there was a “dramatic lack of democratic basis in this decision.”
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