EU-Russia 2018 Trade Hit US$300 Billion Despite Sanctions
Trade turnover between Russia and the EU grew by 20 percent in 2018, Industry and Trade Minister Denis Manturov said during a meeting with representatives of European business in Moscow this weekend. “The volume of accumulated investments from the EU countries to the Russian Federation amounted to 300 billion euros last year. This is a lot. This shows that the European business is interested in coming to our country, investing its funds in the development of its business.”
Chris Devonshire-Ellis of Dezan Shira & Associates comments: “It has taken about three years for the Russian economy to adapt to sanctions and for Russia market focused businesses in the EU to evolve to dealing with this. What has been happening that in many industries, and especially those barred from exporting products to Russia, these sectors have instead relocated production to service the Russian market from Russia. A form of mass technology transfer has been taking place, and this is especially true in the processed consumer foods arena. That production capacity is now permanently lost from the EU, while at the same time the Russian market has pent up consumer demand. Lower taxes also make Russia an attractive manufacturing destination for local consumption.”
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