Twisted effects of Russia sanctions

EPA/YURI KOCHETKOV

Prices on meat in Russia rose due to Western embargo.

Twisted effects of Russia sanctions


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The Russian economy has been suffering from the effects of Western economic sanctions and oil prices, the backbone of the country’s economy, which are currently hovering around 11-year lows.

In Russia, the national currency, the rouble, has fallen about 20 % against the dollar this year, on top of a 40 % slide in 2014, pushing up the price for imported goods. A Russian ban on Western food imports, imposed in retaliation for U.S. and European economic sanctions, has further hurt supply, pushing up prices.

Meanwhile, according to the Ukrainian UNIAN news agency, trade between Russia and some EU states is growing despite the embargo.

According to data of the Russian Federal Customs Service, seven EU states had their trade turnover with Russia increased in the last year: Belgium (8.8%), Denmark (23.2%), Latvia (18.2%), Romania (+0.2%), Slovenia (2.5%), Croatia (12.4%) and Estonia (10.6%). However, only three of them boosted own exports to Russia, namely, Romania – 8%, Croatia – 7.5%, and Estonia – by 104.8%.

The major EU exports to Russia are machinery and equipment, chemical products, ground transportation, nuclear reactors and boilers, pharmaceutical, agricultural and food products, clothing and footwear, that is products with high added value.

At the same time, again according to UNIAN, Estonia (together with Lithuania and Poland ) have been hit the hardest by Russia’s embargo. The Baltic countries and Poland have been die-hard Kremlin opponents. Not only have they constantly insisted on the need of extending the sanctions, but they have also repeatedly argued for their strengthening.

Poland even proposed that Russia be disconnected from SWIFT, along with an embargo be imposed on purchases of Russian coal. Lithuanian leader repeatedly appealed to the Western allies to use ‘all means necessary’ to help Ukraine, despite the fact that Lithuania has lost almost half of its exports to Russia and been ill-affected most by the Russian embargo.

The Kremlin is also using far-right parties in Europe to sow discord among the EU countries. Thus Russia is using the Front National, the third largest political force in France, and other anti-EU parties as a vehicle to lobby its political interests in Europe. Marine Le Pen, whose party came first in European elections in May 2014 with 25 % of votes and obtained even more in the recent French local elections, has made no secret of her sympathy for Russian President Vladimir Putin.

One other example of ties with Moscow is the UK Independence Party, commonly known as UKIP, whose leader Nigel Farage’s appears very frequently on state-owned Russia Today and who is very criticised for his expression of open admiration for Vladimir Putin.

Also, the Italian Northern League’s leader, Matteo Salvini calls the euro a “criminal currency” and wants to demolish the Brussels consensus that has dominated European politics since the end of World War Two. Matteo Salvini is also an open admirer of Vladimir Putin and a friend of Marine Le Pen.

(with AP, UNIAN)
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