Page 22 - RusRPTApr19

2.7 Politics - misc
The European Union, Canada and the United States have added a number of Russian individuals and legal entities to the sanction lists on March 15 for their involvement in the Black Sea military standoff in the Kerch Strait in November 2018. The additional sanctions are unlikely to have any economic impact, but maintain the sanction pressure in place. At the beginning of March, the US prolonged Ukraine-related sanctions against Russia for another year. As analysed by bne IntelliNews, more negative news flow on sanctions is the main potential catalyst for Russian market in the coming months: a bipartisan group of US senators tabled legislation on February 13 that could broaden and deepen the US sanctions regime on Russia. In the latest sanction move the USTD outed four members of Russia's FSB security services as well as six defence companies active in Crimea peninsula, "several of which misappropriated Ukrainian state assets to provide services to the Russian military". The EU sanctions target eight senior Russian security personnel and military officers responsible for detaining three Ukrainian vessels in disputed waters off the coast of the annexed Crimea. Twenty-four Ukrainian sailors are still in detention after being taken into custody when the ships were fired upon and then seized on November 2018. Canada imposed sanctions on 15 entities and 114 individuals.
Turkey and Russia have been in talks on allowing Russian nationals to travel to Turkey without a passport, the Turkish foreign minister said on March 25. If the arrangement is sealed, it could prove a boon for Turkey’s tourism industry, a major source of hard currency for the country. Turkey has been very popular with Russian tourists for years. Visits by Russians, however, came to a near halt after relations between the countries turned sour when Turkey shot down a Russian fighter jet over Syria in 2015. But Russians started to flock to Turkey once more after Ankara and Moscow reset their relationship.
Russia's finance ministry has proposed raising the minimum retail price (MRP) for champagne by 26% to RUB206 ($3.2) for 0.75 of a litre from the current RUB164 per litre, Prime reported citing an announcement on the government's bill platform. The decision is motivated by the increase in the VAT rate between 2016 and 2019, higher electricity tariffs, the cost of grapes, and the change in the system of excise duties. The measure could support Russian wine producers, notably Abrau-Durso, the main producer of sparkling wines. In September 2018 the produce of Russian wineries for the first time accounted for over half the domestic wine sales with a 52% market share, up from 43% a year ago.
Corruption in Russia’s military has quadrupled to RUB7bn ($109.8 mn) in 2018, the top federal military prosecutor said on Thursday. Russia ranks among the world’s most corrupt countries in international ratings, with corruption-related crimes costing an estimated $2.5bn in damages between 2014 and 2017. Observers have said that anti-graft campaigns under President Vladimir Putin’s rule have brought little progress.
Sanctioned Russian billionaire and Kremlin insider Oleg Deripaska has sued the US Treasury Department (USTD) in the federal court of Washington, seeking to block the sanctions that have been in place since April 2018. The devastating sanctions on Deripaska breach some of the pillars of the US legislation, such as the presumption of innocence, and the resulting isolation from the global business community is estimated by Deripaska at
22 RUSSIA Country Report April 2019 www.intellinews.com