Commodity embargo, the Russian Federation and the enormous loss of Ukraine

Russia decided to extend reciprocal economic measures against countries that have joined the sanctions against Moscow before the end of 2017.

Recall that the food embargo operates in Russia since 7 August 2014 in respect of products from the US, EU, Australia, Norway and Canada. Last year it was extended until 5 August 2016. And from 1 January 2016 and Ukraine had been listed.

Russia banned the import of Ukrainian meat, sausages, fish and seafood, vegetables, fruits, dairy products. In response, Kiev has approved a list of 43 headings. The ban came baked goods, meats, cheeses, chocolates, equipment for railways and diesel-electric locomotives.

How this decision will affect the Russian Ukraine, the radio station Voice of the Capital predicted economic expert Vsevolod Stepaniuc.

How strong is the extension of the embargo hit in Ukraine, or our manufacturers have already found their niches in other markets?

- I would not say that our manufacturers have found other niches. Moreover, a number of products that can be sold only on the territory of CIS countries and nowhere else. So, of course, it will continue to have a negative impact on the economy of Ukraine. Again, Russia stresses that this embargo mutual, that is, they introduced it as a reaction to the same penalties. This put in the greenhouse conditions, for example, Russian agricultural industry, which is very well developed and has high profits and the like. And it reduced the capacity of our agricultural sector. Because even European farmers are compensated, and Ukrainian - no.

If you speak the language of numbers, as Ukraine has lost because of this embargo?

- Direct losses from the embargo on food accounted for somewhere around $ 1 billion, but it’s only live, frozen, customs statistics. Because the loss of one dollar of exports entails the loss of a few dollars in the country.

It went a lot of talk about the re-profiling of Asian and African markets. What can be said about this area?

- This trend is, in principle, quite promising. But for this Ukrainian companies must have the financial capacity. Not having the financial capacity or the new one will not enter the enterprise market. To access to the EU market, you need more money to the Chinese market - a little less, in Africa - even smaller, but still need the money. Although our policy NBU lending virtually non-existent. Including due to our Ukrainian power companies financial policy can not find other markets.

30 May 2016

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