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Russia Starts a Trade War with Turkey - What should Georgia Expect?

Russia Starts a Trade War with Turkey – What should Georgia Expect?

In response to the attack on Su-24 by  a fighter aircraft of the Turkish Air Force, Russia restricts imports of goods from Turkey.

Suppliers of Turkish products have already faced problems at customs posts and clearance, as importers say, is actually stopped. The restrictions on the import of food from Turkey(which amounted to $ 1 billion only in ten months of this year) may be officially announced on November 26. Imports of Turkish automotive components ($0.44 billion as  of 2014) are  also under the threat that  could  seriously affect the Russian car assembly plants.

Russia in the near future will limit the supply of products from Turkey – on Thursday it could be announced officially, a Source in one of the ministries told Russian newspaper Kommersant. The embargo, as in the case with the EU, US, Australia, Norway and Canada, will not be introduced, at least in the short term, stresses the “Ъ” source. At this stage the mechanisms limiting  imports are being developed,  says a government official.

They say in Rosselkhoznadzor that the agency has no plans to strengthen the control over the Turkish products. The Ministry of Agriculture states that currently they are analyzing the situation with the supply of food from Turkey.

According to the Federal Customs Service of Russia,  restrictions for commodities from Turkey were  imposed at Russian customs points. This means that the Customs Service will refuse the registration of the declaration for the products from  Turkey. If the inspector still decides to issue a declaration for such products, it will be necessary to coordinate this with all functional departments, to conduct 100 percent inspections and take samples to verify compliance with safety and quality parameters, – says the source.

Imports from Turkey in 2014 amounted to 4% of Russia’s total food imports.  In  ten months of this year, Turkey imported food in Russia worth $1 billion, mostly tomatoes and citrus fruits. In particular, in 2014 this country imported 366 thousand tons of tomatoes, which is 43% of the total imports of tomatoes in Russia. “These volumes can be replaced by products from Iran, Morocco, Israel, Azerbaijan, Uzbekistan,” – Minister of Agriculture Alexander Tkachev says. 250 thousand  tons of citrus fruits, which are now coming from Turkey, the head of the Ministry of Agriculture offers to replace with products from South Africa, Morocco, China, Argentina, Israel, Abkhazia, Georgia.

Turkey is the largest importer of Russian sunflower oil and grain. During 2014, Russia exported to Turkey 5.8 million tons of grain (wheat, corn, rye), as well as 616 thousand tons of sunflower oil.

The Minister of Agriculture believes that in case of termination of grain exports to Turkey, the grain may be exported to the Middle East countries, such as Iran, Iraq, Libya, Lebanon, Israel, as well as African countries.

Kommersant sources on the auto market  claim  that the problem of delay of automotive components at customs can affect almost all market players,  in particular,  AvtoVAZ, Renault, Toyota, Kia.  Moreover, 14 Turkish ventures  for the production of automotive components are operating  in Russia.

“Ъ” source in the market believes that due to the long delivery delays, “a number of plants could stop functioning.