Russia retaliates against sanctions with ban on Western food imports

PUBLISHED : Friday, 08 August, 2014, 4:23am
UPDATED : Friday, 08 August, 2014, 4:23am


Russia banned most food imports from the West yesterday in retaliation for sanctions over Ukraine, an unexpectedly sweeping move that will cost farmers in North America, Europe and Australia billions of dollars but will probably also lead to empty shelves in Russian cities.

The US and the EU have accused Russia, which annexed Ukraine's Crimean peninsula in March, of supplying the insurgency in eastern Ukraine, and have sanctioned individuals and companies in Russia in retaliation. Moscow denies supporting the rebels and accuses the West of blocking a political settlement by encouraging Kiev to use brutal force to crush the insurgency.

The ban, announced by Prime Minister Dmitry Medvedev, covers all imports of meat, fish, fruit, vegetables, milk and milk products from the US, the European Union, Australia, Canada and Norway. It will last for one year. "Until the last moment, we hoped that our foreign colleagues would understand that sanctions lead to a deadlock and no one needs them," Medvedev said. "But they didn't, and the situation now requires us to take retaliatory measures."

That retaliation, however, could hurt Russia as much as the West. In 2013, the EU exported €11.8 billion (HK$122 billion) in agricultural goods to Russia, while the US sent US$1.3 billion in food and agricultural goods.

EU Commission spokesman Frederic Vincent voiced regret about the ban. He said the commission reserved "the right to take action as appropriate".

While the government claimed it would move quickly to replace Western imports with food from Latin America, Turkey and ex-Soviet neighbours, analysts predicted shortages and price hikes. With retail chains stocked up months ahead, the ban will take time to hurt.

Medvedev also said that in response to EU sanctions against Russian low-cost airline Dobrolet, Russia was considering a ban on Western carriers flying over Russia on flights to and from Asia, which would significantly swell costs and increase flight time.