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The import embargo: EU counting losses, entrepreneurs thinking of new sales logistics

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The specter of food stuffs banned on import into our country was voiced today at a government session. Alexandra Lee tried to find out – how comfortable will our compatriots be without foreign food.

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Peaches from Spain passed the customs control before the embargo was introduced, which means those will find themselves at store shelves in St. Petersburg. Everything else which came later will not be admitted by customs officers. Companies are already counting losses.

Evgeniy Antonov, head of advertising and PR department of customs-logistics company: “10 percent losses on fish, 30 percent on dairy products. We are expecting decrease in processing of customs cargo. Time will tell”

Retailers use time to alter the whole logistics of sales: meat from the USA and Canada, fish from Norway, milk and fruits from EU countries – those will have to be replaced by either domestic products or shipments from LatAm or Asian countries, Japan and Switzerland. The last two, by the way, were not blacklisted – despite introducing sanctions against Russia. St. Petersburg, however, win will from this – say experts. Limitations will bolster domestic industries.

There are, however, doubts about that: in the country with the so-called risky type of agriculture, development of nationwide own industry is under a question mark. Governor of the Krasnodar region promised to save the country from hunger – he wrote on his own website that sanctions will become a huge impetus for the development for agricultural industry. Making a side notion, however, that producing export goods will become harder for the region. Economists are quite skeptical in their forecasts.

Mikhail Burmistrov, CEO of analytical company: “Its clear that despite political statements about price control, the hike in prices is unavoidable. Why? Its not even the matter of something not being delivered tomorrow – because there are storages in retailing organizations, warehouses of producers have their storage too. But, on the other hand, if a deficit is formed, then suppliers use the market’s capabilities.

Government of St. Petersburg assures – prices will be held.

Elgyz Kachaev, head of entrepreneurs and market development committee: “The main thing is that those speculating on the prices do not use it at their advantage. We will keep a very close eye on that” 

Another minus is that Russia – which has been striving for 20 years to gain membership in the WTO – will automatically drop out of it. But this is nothing, compared to the country’s reputation – once violated and now restored, says political analyst Alexander Konfisakhor.

Alexander Konfisakhor, researcher at political psychology department at SpbGU: “Finally we have hit back. Because you can’t be a patsy all the time – the one punished, intimidated, threatened and punched all the time – these new sanctions included. They don’t consider us as partners, don’t think we are the state which can and must protect its interests”

Limitations will last for a year since the decree was issued. But, it says, the date may change – according to circumstances.

Alexandre Lee, reporter: “Starting from publication of banned food stuffs list, that is from this day on, the presidents decree will concern 10 percent of agricultural import. Retailers foresee complete disappearance of products from unfriendly states in one month to six weeks. How will the consumers suffer, that’s a philosophical question – whether the basket is 10 percent empty or 10 percent full…of import-replacing products?”

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