Russia’s Extended List of Sanctioned Countries Leaves Out Georgia
Russia said it did not add Georgia to the extended list of countries subject to a food products import ban because “measures taken by the Georgian leadership towards Russia are insignificant.”
Russia has added Iceland, Liechtenstein, Albania and Montenegro to a list of countries from which it has banned imports of food, including meat, fish, dairy products, fruit and vegetables, because these countries joined EU’s sanctions against Russia. Russian PM Dmitri Medvedev said on August 13 that the ban will also apply to Ukraine from January, 2016 if the free trade agreement between Kiev and the EU comes into force.
Last year, along with Albania, Montenegro, Iceland, Liechtenstein, Norway and Ukraine, Georgia aligned itself with one of EU’s sanctions involving ban on imports originating from Crimea and Sevastopol. Those countries, except of Georgia, have also aligned themselves with other sets of EU sanctions, targeting major Russian state banks, energy and arms sectors, as well as blacklisting dozens of Russian officials and Russia-backed separatist commanders in Ukraine. After the EU extended prohibition of imports from Crimea until June 23, 2016, Georgia continued its alignment with this sanction.
“At the moment Russia and Georgia have no active relations and high [trade] turnover,” the Russian government said in a press release, Russian news agencies reported. “Unlike other countries, measures, taken by the Georgian leadership towards Russia, are insignificant. Because of that it has been decided that there is no necessity to include this country [Georgia] in the list of countries and producers, which are banned from supply of some agriculture products [to Russia].”
Commenting on Russia’s decision, Georgia’s Finance Minister Nodar Khaduri told journalists in Tbilisi on August 14: “Georgia cannot afford itself to choose on which markets to work or not to work; Georgia should use all the markets, all the opportunities and of course Russian market, as well as markets of former Soviet republics are interesting in this regard.”
Agriculture Minister Otar Danelia said that any market, including the Russian one is important for Georgia, adding that “diversification of export markets is a priority.”
“Any positive decision that can benefit the country is welcomed,” he added.
Georgian state minister for reconciliation and civic equality Paata Zakareishvili said: “Because of Georgia’s pragmatic and prudent policy, we are able to separate issues on which resolution is possible with Russia from those on which resolution is not possible. We think that in those areas where it is possible to resolve issues, we should not take such steps, which may harm Georgia’s interests. So I welcome that our policy… has yielded results and Georgia continues trade relations with [Russia], which are in [Georgia’s] state interests.”
After Russia lifted trade embargo, which was imposed in 2006, Georgia’s exports to Russia increased four-fold in 2013, compared to previous year, to USD 190.2 million. Exports to Russia saw over 44% y/y increase in 2014, reaching USD 274.9 million, accounting for 9.6% of Georgia’s total exports last year.
But after Russia’s economic downturn, Georgia’s exports to Russia suffered almost two-fold decline to USD 70.6 million in the first half of 2015, compared to the same period of last year.
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