After European countries imposed sanctions against Russia for invading Ukraine, many EU countries not only did not stop deliveries of goods to the Russian Federation, but even managed to increase them – with the help of re-export through the countries of the former USSR neighboring Russia. RBC writes about this with reference to the report of the research company Euromonitor International.
According to Eurostat, which the authors of the report refer to, exports from Europe to Russia after the imposition of sanctions, in the period from March to November 2022, fell by 47% compared to the same period in 2021, and amounted to € 36.3 billion. But at the same time exports of European goods to countries neighboring Russia, such as Belarus, Armenia, Kazakhstan, Georgia, Uzbekistan and Kyrgyzstan, grew by the same 48% over the same period in 2022 and amounted to €20.3 billion.
The fact that Russia is actively using the re-export of goods from the EU to circumvent sanctions through smuggling and purchases through the countries of the former USSR, Radio Liberty has already reported. Now these data have received official, numerical confirmation.
Euromonitor emphasizes that the main growth in exports from the EU to the countries of the former USSR fell on goods that fell under anti-Russian sanctions – it amounted to 95%. The export of these goods to Russia collapsed by 71%. For example, in November 2021, the total exports of these types of goods to Belarus, Armenia, Georgia, Kazakhstan, Uzbekistan and Kyrgyzstan amounted to only €500 million, and in November 2022 it tripled and amounted to €1.5 billion.
Euromonitor International expert Vaidotas Zemlis-Balevichius believes that a significant part of the sudden increase in European exports to the countries of the former USSR goes to the Russian market: Russia’s neighbors help it bypass European sanctions. On this basis, Euromonitor International concludes that EU sanctions do not work as originally intended, and most European countries have problems with export control of goods that are sent to Russia’s neighboring countries.
Cyprus, Greece, Luxembourg, Estonia, Lithuania, the Czech Republic and Romania became the leaders in terms of growth in exports to the countries of the former USSR last year. These countries, as emphasized by the authors of the report, increased the volume of deliveries from 100 to 550% over the specified period. According to Zemlis-Balevichius, the reason for this growth is in personal export permits, as well as the fact that restrictions were introduced gradually and companies were allowed to fulfill contracts already signed.
Euromonitor International estimates the current level of deliveries of European goods through third countries to Russia at around €700 million per month. However, this is significantly lower than in 2021, when the level of supplies of goods from the EU was € 2.7-2.8 billion per month, but still very significant.
The researchers also identified several “statistical anomalies” – we are talking about increasing exports by 100% or more during the reporting period. The most suspicious, according to the authors of the report, is, for example, the export of used cars with certain engine parameters from Lithuania to Belarus. Growth in this category of goods amounted to 215% and reached €174 million.
Earlier, the Council of the European Union extended economic sanctions related to the banking, financial and energy sectors of Russia until July 31, 2023. Currently, these restrictive measures consist of a wide range of sectoral measures, including restrictions on trade, finance, technology and dual-use goods, industry, transport and luxury goods.
Since the beginning of Russian aggression in Ukraine, the EU has introduced nine new packages of sanctions that impose restrictions on 1,300 individuals and 120 legal entities.
In February 2023, the EU is preparing to introduce the tenth package of anti-Russian sanctions, which, according to Reuters, is proposed to include restrictions on Russia’s nuclear sector, in particular against Rosatom.
Why, despite the sanctions, less than 10% of Western companies left the Russian Federation with the start of the war, the economist explains:
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