Page 69 - bneMag Dec22

bne December 2022 Eastern Europe I 69
Russia’s trade partners are simply rerouting supplies through these countries or local traders are taking advantage of the parallel import schemes to send hard to find goods to what remains the largest consumer market in Europe.
In 2021, Russia-EAEU trade amounted to $72.61bn, of which Russian exports to the EAEU members amounted to $45.3bn. Over the first seven months of this year again the volume of trade at $74.2bn surpassed the full-year result for the previous year. Extrapolating this result suggests that the full-year trade turnover with the EAEU will hit $127.2bn, with Russia’s exports rising to about $99.6bn. That means a gain of $54.59bn in volume, of which $54.3bn are exports during the year.
Turkey has been another big winner from the sanction’s regime and as bne IntelliNews has reported, its docks are busting with containers on their way to Russia. Bilateral trade with Russia in 2021 amounted to about $30bn, with some $23bn of this being Russian exports to Turkey. The two countries engage in a great deal of energy trade; however, Russia’s need for parallel imports is also feeding an increase
in bilateral trade. In the 10M 2022, Turkey-Russia bilateral trade has been worth about $60bn, of which Russian exports to Turkey amount to $25.99bn. Compounded over the whole of 2022, this would indicate a total trade volume of some $72bn and Russian exports of about $31.19bn, increases of $42bn and $8.2bn respectively.
Another, but less well known, winner from the sanctions is Azerbaijan, which has also been playing both sides of
the field, signing new gas deals with European Commission President Ursula von der Leyen on the one hand but boosting exports to Russia on the other.
President Ilham Aliyev of Azerbaijan said this week he is “satisfied with the growth of trade turnover with Russia”, Tass reported, and he sees “prospects for its growth.” According to the leader, there is potential in the area of cargo transportation as well. "We are very
Russian import flows, $ bn
Source: * BCS estimates, Trade partners statistics
glad, of course, that mutual trade is returning to the pre-pandemic level, and I am confident that the dynamics will persist," he said during a visit to Baku of Russian Prime Minister Mikhail Mishustin on November 18. The trade turnover between Azerbaijan and Russia in January-October 2022 rose by
While many have curtailed operations, by Yale’s own stricter criteria, the number that have actually fully exited Russia is only 310. A separate study by Kyiv School of Economics (KSE) that has a larger sample size of 2,407 companies, numbers only 46 as having fully quit the Russian market.
“Another, but less well known, winner from the sanctions is Azerbaijan, which has also been playing both sides of the field”
22.3% year on year and amounted to $2.9bn, the State Customs Committee of Azerbaijan announced on November 17, adding that exports of Azerbaijani products to Russia in January-October amounted to $719.1mn (+3.2% y/y), but the imports of goods from Russia was up by a third (+30.4% y/y) to $2.1bn
The trade is being driven partly by many of the 1,000 international companies that are continuing to trade, despite declarations they would depart. Three- quarters (77.6%) of the 1,382 foreign companies registered in Russia are still operating, according to Vyacheslav Volodin, chairman of the parliament’s lower chamber, the State Duma, in a post on Telegram on August 9. “In spite of the unprecedented pressure, blackmail and sanctions, 77.6% out of the 1,382 foreign companies did not close their business in Russia,” he said in August.
Even among those companies that
are leaving, many are selling to their management teams, distributors, or simply to opportunistic entrepreneurs in a tsunami of M&A unleashed by the sanctions. The new Russian owners are largely continuing the business
as before, but often rebranding with very similar brands, and cutting direct connections with the former parent companies, but still importing the same goods, but via parallel import schemes.
Trade with the US was never very significant in dollar terms but was heavily dependent on US exports of high tech and quality equipment, which will be almost impossible to replace. Trade with Europe, however, is very significant and has been badly affected. Imports from the EU are down by half from their 2021 level and are unlikely to recover. But the overall volume of trade in euro
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