Roundup: Lithuania evaluates consequences of Russia's food import ban
0 Comment(s)
Print
E-mail Xinhua, August 8, 2014
Lithuania's officials and business companies on Thursday reacted to Russia's announced ban of food imports from the European Union (EU).
Dalia Grybauskaite, President of Lithuania, claimed that Lithuania's economy would feel only moderate impact.
"It will be partial losses for separate businesses. Carriers will feel the impact the most. All the others will handle this," said Grybauskaite to local media.
According to Grybauskaite, Lithuania already had experience in handling with food exports restrictions from Russia.
"We have learned those lessons, and learned the lessons of milk embargos," added Grybauskaite.
However, some companies expressed their panics after receiving news on broad list of food products embargo.
"We are shocked. It will be difficult for food trading and processing companies to adapt to such sanctions," business news web vz.lt quoted Justas Venckus, chief executive of Limsta Group, exporter of meat, as saying.
Meanwhile, Algirdas Butkevicius, Prime Minister of Lithuania, emphasized the need to expand the activity of economic diplomacy in seeking the alternatives for Russian market.
"One should immediately speed up the organizational activity of Lithuanian authorities and business associations in establishing economic ties abroad and entering new markets," said Butkevicius in a statement after discussing the situation with Linas Linkevicius, Minister of foreign affairs.
According to the office of the prime minister, representatives from all the ministries will discuss ways to diminish possible losses in a meeting scheduled for Monday.
Lithuanian transportation companies should be affected the most since re-exports to Russia accounts for the largest part of the whole exports.
"First and foremost, the most vulnerable sector is transport and logistics and especially those who are mostly dependant on West-East transit of Western goods to Russia," Zygimantas Mauricas, chief economist of Nordea Bank told Xinhua in an interview on Thursday.
"Seventy-seven percent of Lithuania's food and food products exports to Russia are re-exports, mostly fruits, nuts and beverages," according to Donatas Brazdzius, senior analyst from Economic Research Department at DNB bank.
"Transportation and logistics sectors servicing the flows of re-exports will have to decrease their activity based on Russia and look for other markets," he added.
According to the analyst, food exports to Russia accounted for 4.74 billion litas (around 1.9 billion U.S. dollars), or 5.6 percent of the whole food exports in 2013.
"But the impact on food sector would be relatively weak since Lithuanian business is competitive enough to turn to alternative markets quite quickly," Mauricas said to Xinhua.
According to Mauricas, "Mutual sanctions could see the euro zone sliding into its third recession because some EU countries are still very fragile after the economic crisis of 2009."
"But as for now, it is too early to estimate a long-term effect," he said.
Russia on Thursday banned imports of fruit, vegetables, meat, fish, milk and dairy products from the United States, the EU, Australia, Canada and Norway in response to Western sanctions. Endit
Go to Forum >>0 Comment(s)