New trade war within Customs Union
8:37, — Economics
Belarus is going to restrict household appliances imports from Russia.
Under the threat of having troubles with supplies to the market of over $600 million annual worth vendors and producers have already addressed Lukashenka and the Eurasian Economic Commission (EEC) asking to drop the idea. But the EEC’s capabilities to influence the situation are limited and the settlement may last for years, while the rates at which the trade turnover between the Customs Unions countries is dropping are growing, Kommersant reports.
The Russian Association of Trading Companies and Producers of Household Appliances and Computer Equipment (RATCPHACE) sent letters to Lukashenka and the chairman of the board of the Eurasian Economic Commission Viktor Khristenko on the matter of the possible introduction of non-tariff restrictions on household appliances and electronics imports into the country.
According to the association, two potential measures are being discussed: exclusive right of the state on the imports and the introduction of the institution of licensed imports. The RATCPHACE asks Lukashenka to abstain from such measures, while they ask Khristenko “to apply his influence” in helping persuade Minsk. “Such decisions may slow down the launched integration processes and lead to the loss of trust on the part of producers to the EEC”, - the letters say. At the EEC board they confirmed that they had received the letter, having refused to give a detailed comment on the situation before it gets looked into by specialized departments.
Belarus is an important market for the Khristenko, the association’s representative Anton Guskov emphasizes. It is not only the matter of the goods, produced in Russia, - a significant part of imported electronics comes to Belarus from Russia.
Imports restricting initiatives do not contradict the EAEU agreements, Anton Guskov admits, but “may complicate the cooperation in the framework of the union”. In its letters RATCPHACE also points that large international producers have already started reorganizing their distribution system due to the creation of the single economic area within the Customs Union. They build storehouses and logistical units in Belarus, and also they include their trademarks into the local customs registry (in particular Bosch, Apple, Xerox, Canon, Electrolux and others). According to Belarus’ National Statistics Committee, in January-April 2014 the country imported $53.9 million worth of cell phones, including $25.6 million from Russia. Imported TV-sets accounted for $53.6 million, including $45.4 million – from Russia. The imports of electric cookers, including ones for household usage, amounted to $31.9 million ($8.3 million – from Russia). The total worth of the imported computers and portable computers amounted to $104.5 and $53.9 million respectively, including $13.2 and $9.3 million worth from Russia respectively.
It was planned to provide the state with the exclusive right to import certain goods by Lukashenka’s respective decree, the draft copy of which was obtained by journalists. According to it, the imports of radio-, tv-, video- and household appliances, as well as electronics was to be delegated to three local producers – Horizont, Atlant and Integral. But the term for agreeing the draft with the ministries ran out last Monday. According to Belarus Ministry of Industry’s press-service, “the introduction of the special importers practice is not planned for the future”.
At the same time, despite the protests on the part of the Russian Federation and the EEC, Belarus has for several years been keeping the institution of special importers of alcohol and fish products. From 2010 the commission managed to achieve the abolition of imports restrictions on sea fish, and in 2013 – fresh water fish, but in 2014 there are still 18 companies left that are special importers of fish products (against 11 special fish importers in 2013 and 39 in 2012). Special importers of alcohol (33 companies in 2014) have also lost a part of the market after the state monopoly was introduced in 2008 on alcohol imports and transition from import quotas to a competition between importers. Now the final list of special importers of alcohol is certified by Lukashenka personally, while the abolition of the institution is linked to the abolition of the export duty imposed on Russian oil.
This political decision is linked to the “re-launching” or the Single Economic Area, which has yet been postponed until early 2015, and the Belarusian MFA responses to the Russian claims with the promise to abolish the institution of special importers starting on 1 January 2015. The logic of the events pushes to the assumption that, even if it happens, Minsk will find ways to smoothly limit the list of the companies, allowed to import goods, sensitive for Belarus’ market. Thus, yesterday they did not answer to the question of the possible introduction of licensed imports practice at Belarus’ Ministry of Industry. In the meanwhile the trade turnout between Russian and Belarus is dropping: in the first quarter it dropped by 7.3%, while in general the turnover of the trade within the Customs Union countries lost 13% altogether after the initial 5.5% drop in 2013.
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