UPDATE: PM orders Russian govt to prolong food import ban till ‘18

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GORKI, Moscow Region, May 27 (PRIME) -- Russian Prime Minister Dmitry Medvedev has ordered the government to prepare proposals for prolongation of a prohibition to import food from the E.U., the U.S. and some other countries, which earlier introduced sanctions against Russia, until the end of 2017, he said Friday.

“I have ordered preparation of proposals for prolongation of the retaliatory measures until the end of 2017 rather than for one year. A petition to the president and a ruling of the government stipulating necessary decisions will be made accordingly,” Medvedev said.

In 2014, relations between Russia and the West deteriorated to their worse since the Cold War due to a military conflict in Ukraine. The West introduced sanctions against some Russian individuals and firms and further against the energy and banking sectors. In response, Russia limited food imports from some countries, including the U.S., the E.U., Canada, Australia, and Norway.

Earlier on Friday, U.K. Prime Minister David Cameron said that G7 countries have agreed with a necessity to prolong the anti-Russian sanctions in June. The sanctions can be scaled up further if needed, the G7 said in a statement after a summit in Japan.

Germany’s Foreign Minister Frank-Walter Steinmeier said that the sanctions against Russia may be lifted gradually if there is some progress in fulfillment of the Minsk agreements by the end of June.

DOMESTIC GAINS

Russian Agriculture Minister Alexander Tkachyov said that the ministry has already started preparing a draft ruling to prolong the agricultural ban until the end of 2018 and has no plans to extend the list of banned products.

“It is excellent news for national agricultural producers; it allows them to plan investment in the industry, to increase quality of Russian foods and competitiveness,” he said.

A representative of the Economic Development Ministry told PRIME, “Revising the list of countries and goods, imports of which to Russia is banned, as well as terms of the ban will be considered by the Russian government.”

The ministry believes that the Russian retaliatory sanctions particularly sped up inflation in the country in late 2014 and early 2015, but now these measures have almost no influence on it.

“According to our estimates, the counter-sanctions contributed about 3 percentage points to inflation by March 2015 (when annual inflation peaked at 16.9%). Russia’s domestic food production is rising faster than food imports in physical terms and by value. It advocates for import substitution in this field,” the person said.

“In 2016, influence of the counter-sanctions almost went to naught due to substitution of sanction-hit products for national products and imports from other countries,” the representative said.

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