Despite the sanctions EU-Russia trade is recovering

RT
Tue, 19 Dec 2017 09:10 UTC

© Peter Andrews / Reuters

The Polish-Russian border near the village of Ostre Bardo

Trade between Russia and the European Union started to improve in early 2017 despite trade barriers from mutual sanctions introduced three years ago, according to the latest report by the European Parliament.

"In the first half of 2017, EU-Russia trade grew by 26 percent year-on-year, ending a prolonged downturn," the report says.

However, mutual trade between Russia and the 26-nation bloc is still down by 45 percent against December 2013, according to Brussels analysts. At the same time, the EU reportedly remains Russia's biggest foreign trading partner. EU countries account for nearly 47 percent of Russian international trade, as of the middle of the current year.

Comment: It seems factions in the EU are at loggerheads with some bureaucrats hoping to halt trade and others going ahead anyway, as the numbers show. Whatever the party line is, the anti-Russian sanctions implemented in coordination with the US to hurt Russia's economy has failed, and clearly the EU is suffering the most:

• Economic sanctions against Russia flop: First comprehensive study shows they hit EU much harder
• Self punishment? EU extends sanctions against Russia without any discussion
• Europe is in revolt against anti-Russia sanctions
• SOTT Exclusive: Reckless sanctions against Russia affect Dutch companies, farmers, and flower growers
• EU's economy can't bear anti-Russian sanctions, both agree to lifting 'trade barriers'

"The EU exports a diversified mix of mainly manufactured goods to Russia - machinery, cars, electrical and electronic equipment, medicines and agrifood. Russian exports to the EU are dominated by fossil fuels, followed by metals," the report says, stressing that massive energy exports from Russia to the EU tipped the trade balance toward a substantial Russian surplus.

© europarl.europa.eu

As to the effect of anti-Russia sanctions, the experts say that banning such categories of Russian exports as arms, dual-use equipment and innovative technologies for developing hard-to-access oil reserves could have its impact on Russia's crude production only in the long term.

Comment: See:

• Russia holds top spot for oil supply to China, doubles exports in six years
• Russia bypasses US oil war, signs billion dollar deals with Saudi Arabia

"However, the immediate impact on trade volumes is limited as all three categories only represent a small percentage of Russian exports," the report says.

The most significant impact on the mutual trade was reportedly produced by Russian mirror measures adopted in August 2014, which banned various EU agricultural and food goods. According to the report, most EU food producers have adapted to the ban turning to other markets, including the US and China. However, some members have been particularly hard-hit.

"Finland, Latvia, and Estonia have lost 37, 33 and 26 percent of their third-country agrifood exports," the report says.

Comment: Russia's record wheat harvest sees it replace US as agricultural superpower

The issue of the Russian food embargo is really sensitive, particularly in the Baltic nations, according to a Member of the European Parliament from Estonia, Yana Toom.

"Estonian meat and dairy industry had to get through bid problems and hasn't recovered from the blow yet," she told RT.

Comment: Also See:

• World Bank: Russia has emerged from the recession, economy moving towards growth
• Russia's economy is growing, more than most rating institutions realize
• Sanctions fail: Russia's GDP expected to exceed $4 trillion for the first time ever
• Russia's economy continues to climb as foreign investments double in 2017
• Careful what you wish for: If the Eurozone fails, Russia's economy will fail with it
• Russian economy saw manufacturing growth in July