Everyday necessities like food are being used by Russia’s government in the international struggle for peace in the Crimea region of Russia and Ukraine. Russia has banned imports of most food from countries party to the European Union’s economic sanctions against Russia.
The EU’s economic sanctions against Russia mainly ban activity that profits banks and some blacklisted individuals, and are meant to pressure the Russian government to end its violent campaign against Ukrainian nationalists. On Monday, Russian Prime Minister Dmitry Medvedev signed a decree stating that starting Jan 1, 2016, the Kremlin’s existing embargo, meant to retaliate against nations party to EU sanctions against Russia, will be extended to keep food flowing from Ukraine into Russia.
In spite of a rocky economic track record from the Soviet era, Russia is well-known for its self-reliance when it comes to food. Recently, Natural Homes shared a popular post revealing that 51 percent of Russia’s food was grown by communities in rural areas and peasant farmers.
Some entrepreneurial Russian foodies are managing just fine around the constraints created by the sanctions, reports Russian blog Understand Russia. Small business owner Alexander Krupetskov started an artisan cheese shop just a month before the embargo was established last year. Since then, not only has his business flourished, but he has also opened a second shop. In his favor, food from neutral Switzerland was not subject to the embargo and he was able to focus on Swiss cheese and supporting local manufacturers.
Nevertheless, after more than a year of extended sanctions against imported food, a food shortage has begun, according to The Moscow Times.
Some food producers have increased production significantly over the last 17 months, including meat and dairy producers and beef and potato producers. But it has not been enough to make up for the loss of food imports banned because of government sanctions, the report states.
“Although the percentage of Russian products has increased, the total market volume that includes both domestic and imported products, has decreased.”
The Kremlin began its embargo on a wide range of food products against the EU, U.S., Norway, Canada, and Australia in August 2014, and extended it this year to include Albania, Montenegro, Iceland and Liechenstein in August this year. At that time, Russia warned Kiev that should the country agree to an economic association with the EU, the sanctions would be extended to include Ukrainian food imports.
Ukrainian Prime Minister Arseniy Yatsenyuk said the sanctions will incur economic losses of around $600 million next year, reported The Moscow Times.
This is Moscow’s intent, of course. The Russian government stated recently that sanctions against Turkey aim directly to eliminate Russian cashflow into Turkish coffers, said Gennady Onishchenko in a Eurasianet report. Onishchenko is widely considered to be the chief architect of Russia’s economic warfare program.
“Every Turkish tomato bought is a contribution to another missile that will be fired at our boys.”
If former food sanctions are any indication, the sanctions may benefit Ukraine in the long term, while hurting both nations at least in the short term.
Russia began its career dismantling free trade agreements in 2006 with a ban against Georgian wine following that country’s fight for independence. At the time, almost all Georgian wine was made for export to Russia. Since the ban, Georgia’s vintners have undergone a Renaissance, reinvesting in their vinyards and restyling their brands to appeal to an international market, according to Wine Spectator.
Meanwhile at home, not only is net food production falling below required minimums, a new “truck tax” implemented on Nov. 15 is already causing pain and is widely expected to exacerbate food insecurity throughout Russia, reports the Journal of Commerce.
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