SERGEY ZHAVORONKOV: UKRAINE’S SHARE IN RUSSIA’S TRADE TURNOVER AMOUNTS TO ABOUT 2%

Ukraine has introduced special duties on Russian goods, to be levied from 1 August 2019. The goods in question include liquefied natural gas and diesel fuel.

In this connection, the Moskovskii Komsomolets newspaper published an expert opinion on the issue of trade wars between Russia and Ukraine, presented by Sergey Zhavoronkov, a senior researcher of the Ye. T. Gaidar Institute for Economic Policy:

- Until the diplomatic relations between Russia and Ukraine change for the better, trade between these two states will continue to shrink. Formally, by the results of the year 2018, total trade between Russia and Ukraine did increase, but exclusively due to a notable rise in the prices of the oil and petroleum products bought by the latter from the former. Nevertheless, at present Ukraine accounts for just 2% of Russia’s trade turnover vs. 5% before 2014. The share of Russia in Ukraine’s trade turnover used to amount to about 30% vs. less than 10% at present.

At the same time, the composition of trade turnover between the two countries has not changed. Russia’s exports to Ukraine primarily consist of hydrocarbon raw materials and chemical industry products, while Ukrainian exports to Russia primarily consist of various metals and chemical products. The largest shrinkage in trade was experienced by the food industry. As far as trade in food products is concerned, both sides have easily found alternative suppliers, including in their own territory. However, some substitute goods are much more difficult to find. For example, Ukraine’s exports to Russia include railway wheels, titanium concentrate, uranium concentrate, etc.