It has been more than a year since the Western allies placed sanctions on Russia. These sanctions were imposed on Russia in response to the war of aggression against Ukraine. The sanctions were added to include restricted measures in Russia’s economy and the movement of its citizens. They were implemented to impose severe consequences on the actions that Russia committed at the beginning of years 2014 and 2022. Since 2022, there has been an expansion of the sanctions that were imposed. Many believe it has worked successfully but how successful was it?
So far, there have been 21.5 billion euros worth of assets frozen in the EU that belonged to Russian citizens and another 300 billion euros worth of assets from the Central Bank of Russia, which has been blocked in the EU and G7 nations – Europa.
Imports from Russia that have been stopped, are valued at 91.2 billion euros and 43.2 billion euros of export. The EU and the US believe that the sanctions will affect Russia's war economy and prevent the growth of their military capability.
There is, however, a slight problem when it comes to these sanctions. These are the loopholes in them. Some companies have sold their factories to Russian investors that now produce the same products but under a different name. Some companies continued to sell their product such as Danone or Nestle. Others have rebranded their names such as the company Reserved to RE. Others have officially left Russia but continue to sell their products by exporting them to Turkey, Georgia or Kazakhstan, which are then exported to Russia.
The loopholes allow the business to continue working with Russia respecting the sanctions placed on the country.
The EU is now looking to crack down on the loopholes and try to improve the currently imposed sanctions.
According to Aljazeera, the EU is still doing business with Russia in different markets. Those markets are seen within the trade flow of goods exchange, LNG, nuclear, diamonds, chemical and raw materials. Despite their solidarity with Ukraine and promises to the world that the EU will not conduct trade, some exceptions are made. – Aljazeera
In shops in Russia, people are still able to enjoy foreign brands as they did before the war began, and some only see a difference in the packaging design. Indeed, some products did see a price rise due to lower numbers available in the country and with respect to the sanction. These products include wine or spirits that are twice the price they were before.
Russia knew, at the time, that once the war starts there will be sanctions in motion. This was seen during the Iraq war or in other nations such as China or North Korea. Russia came prepared by turning its economy into a war economy long before the war even started.
Edited by: Rhea Jimmy
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