Finland: Impact of sanctions on Russia greater than when the Soviet Union collapsed

The initial impact of European Union sanctions on Moscow following the invasion of Ukraine has led to a greater reduction in trade between Finland and Russia than when the Soviet Union collapsed in 1991, the Finnish customs service said.

Customs in the country fell by almost 60% in both imports from Russia and exports from Finland to Russia, compared to two weeks before the imposition of sanctions in the EU, said the director of statistics at the Finnish customs, Olli-Pekka Penttila.

“In the 1990s there were no sanctions, payment transactions worked and there was no risk to the business reputation. Now all three are a reality and mean that the impact is clearly greater than it was in the 1990s,” he said. the Penttila.

She said economic sanctions had a greater impact than export sanctions, with the biggest impact coming from reputational risks, as Western companies voluntarily withdraw from Russia to avoid criticism from their customers.

The largest decline has been in goods subject to sanctions, such as machinery, equipment and electrical appliances, but even trade in goods that are theoretically unaffected, such as trade in paper, cardboard and energy products, has also fallen, the data showed.

The biggest impact on imports from Russia has come from voluntary decisions.

Finnish refinery Neste, for example, has replaced some of its crude imports from Russia with Norwegian oil.

UMP and Stora Enso have also stopped buying Russian wood as international certifiers have called it “collision timber”.

Source: Capital

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