In a world of global markets and in which there is a scarcity of food, Western producers and suppliers won’t have any trouble replacing Russian customers who will prohibited by Vladimir Putin’s government from eating their products. It will be back to the good old days, it seems.
According to Russian Television (RT), the state sponsored news service, the ban will last one year, at least.
Let’s see the impact.
“Top 10 US Exports to Russia
America's exports to Russia amounted to
$11.2 billion or 0.7% of overall US exports
1. Machines, engines, pumps: $2.3 billion
2. Vehicles: $2 billion
3. Aircraft, spacecraft: $2 billion
4. Electronic equipment: $674.2 million
5. Medical, technical equipment: $659.9 million
6. Plastics: $378.7 million
7. Meat: $323.9 million
8. Inorganic chemicals: $237 million
9. Fruits, nuts: $222.6 million
10. Other chemical goods: $199.3 million”
Meat, fruits and nuts will lose, but suppliers will locate new customers. Will Russians lose their teeth for a lack of protein?
The way the Russian leaders see it, this will be a boon to domestic agriculture that has been suffering. Now, Russia must feed itself once again, and that is a good thing, right?
ITAR-TASS News Agency reports this economic lesson.
““From economic perspective, this measure will hopefully not only protect the domestic market but also revive our long-suffering agriculture,” said chairman of real economy committee Sergey Grigoriev. It would revive the market and create new jobs, he added.
The measures provided “a certain chance for Russian producers to take a niche on the market and replace imports”, said chairman of small and medium business development committee Dmitry Sazonov. “But it is very important to find a balance with financial and tax burden on business,” he added.
According to chairman of investment climate committee Alexei Repik, “this regime may be quite favorable and even effective as an impetus for Russian production”.
“For some economic sectors, primarily agriculture, this will be a chance to seriously prepare for global competitiveness and boost their market shares,” he said. Russia will be able to go the way of treated by all developed countries such as Germany and Japan as they “created strong competitive sectors and companies by introducing protectionism and closing their domestic markets”.”
Russian economics sounds a lot like the old socialist economics. Wait a year to ask, how’s that working out for you? You know, you can look at the distance and see Sarah Palin sitting on her back porch from here?
“Moscow plans to ban all US agricultural products, including poultry, as well as EU fruit and vegetable imports in response to Western sanctions imposed on Russia over the Ukrainian crisis, according to the country’s agricultural watchdog.
All agricultural goods produced in the US and imported into Russia will be halted for one year, the assistant to the head of Rosselkhoznadzor, Aleksey Alekseyenko, told RIA Novosti.
The list of banned products will be published on Thursday, he added.
EU fruits and vegetables also fall under the ban, Alekseyenko added. A source told Itar-Tass that dairy products from the EU will be included on the list, as well.”
According to an analysis by economists as reported in the Washington Post this morning, Putin’s ban will likely drive up consumer prices in Russia at a time when the ruble is falling against the dollar. Specifically, the cost of protein will be higher for Russians who will have fewer chickens to eat.
Does anyone remember when Americans protested French foreign policy by refusing to eat French fries? It’s the same sort of thing, right?