In more signs that the sanctions affecting Russia are proving to be a boom for new trade corridors, Nikolai Aslanov, Head of Trade Representation for Russia in Egypt has stated that Egypt’s trade exchange with Russia increased by 37 percent during first half (H1) of 2018 in comparison with same period of 2017, amounting to US$3.2 billion. The stats were confirmed by the Russian Federal Customs Service.
Aslanov added that Russian exports reached US$2,810 billion increasing by 42 percent from January to June, while exports from Egypt increased by 12 percent to reach US$402 million in the same period, noting that the main items of Russian exports to Egypt are wheat, metals, oil and gas, transportation goods, wood and wood-works, and fats and oils.
Wheat represented 30 percent of total volume of exports, increasing by 25 percent, while metals and metal ware contributed 23 percent of exports, an increase of 226 percent. Transportation exports reached US$196 million, while wood and wood works’ exports increased by 57 percent up to US$169 million and fats and oils’ exports recorded at US$150 million.
The main Egyptian export items to Russia included fruits, vegetables, garments, electrical machinery, and equipment and soap, noting that fruits’ exports which represent 46 percent of total exports increased by 28 percent up to US$185 million during the first six months of 2018 while vegetables exports with a share of 40 percent reached US$161 million over the same period of 2018. Garment exports reached US$17 million, while electrical machinery and equipment exports increased by 224 percent up to US$15 million, pharmaceutical products reached US$4 million and soap exports increased by 247 percent up to US$4 million.
Aslanov also noted that the total volume of accumulated Russian capital investment in Egypt at the end of 2017 had reached US$4.6 billion, with 60 percent of this in the oil and gas sector. However, that still means Russia has invested close to US$2 billion in machinery and agricultural items.
Chris Devonshire-Ellis of Dezan Shira & Associates comments: “Russia has worked hard to partner with Egypt and these results are also linked to the development of the new Free Trade Zone at Port Said. Russia has been very busy in developing new trade flows and the results in Egypt are testimony that a new era of Russia outbound trade and investment into emerging markets is now well underway. With Egypt also poised to enter into a Free Trade Agreement with the Eurasian Economic Union, the trade corridors Russia is developing in North Africa and the Middle and Near East are going to redefine trade and security in Meditteranean trade flows.”
Russia Briefing is produced by Dezan Shira & Associates. The firm provides business advisory and foreign investment services to international businesses throughout Asia and maintains partners in Moscow, St.Petersburg and Vladivostok. Please contact the firm at email@example.com or visit www.dezshira.com
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