Russia invasion of Ukraine latest: six trade developments this week as WTO bid by Belarus is blocked

Fri 25 Mar 2022
Posted by: Noelle McElhatton
Trade News

The US, EU and largely western allies have blocked Belarus’ bid to join the World Trade Organization, saying its complicity in Russia’s invasion of Ukraine makes it unfit for membership.

G7 countries and allies have already stripped Moscow of its Most Favoured Nation status, clearing the way for them to hit Russian imports with higher tariffs or ban them.

According to WTVB, a group of nations filed a document at the WTO condemning Belarus for its complicity in Russia’s aggression, which they said was incompatible with the values and principles of the WTO.

“For these reasons, we have concluded that Belarus is unfit for WTO membership. We will not further consider its application for accession,” the filing said.

Blanked at WTO

Reuters reports that Western countries are refusing to engage with Russia at the WTO in a coordinated move that has led to negotiations seizing up across a number of sectors.

Trade delegates now fear a June 13 meeting of trade ministers – originally planned for 2020 but twice delayed because of the pandemic – will fail to yield deals.

Russia meanwhile says it will challenge the “unlawful trade restrictions” that have been “adopted in violation of the rules and norms of the [WTO] organisation”. 

Finland trade drops

EU sanctions on Russia have led to a greater drop in trade with Finland than when the Soviet Union collapsed in 1991, Finnish customs said.

There was a roughly 60% drop in both imports from Russia and exports from Finland to Russia following the sanctions, director of statistics at Finnish customs Olli-Pekka Penttila told Reuters.

Renault rues restart

Renault is the latest company to halt production in Russia, just a day after it said it would resume, reports Politico.

While carmakers such as Volkswagen, Nissan and Mercedes-Benz pulled out of the Russian market and stopped exports, Renault had hoped to continue production as Russia makes up around a tenth of its global revenue.

UK latest sanctions

Britain has announced sanctions against 65 more businesses and individuals as the war in Ukraine entered its second month, reports the Guardian.

Six banks and a defence company that produces drones have had assets frozen, as well as the mercenary Wagner Group, which the UK government said had been tasked with assassinating Ukrainian president Zelensky.

Food riots

Meanwhile WTO director general Ngozi Okonjo-Iweala says the impact of the Ukraine-Russia conflict on food prices and hunger could include food riots in poor countries, reports the Guardian.

She warned food-producing countries against hoarding supplies and said it was vital to avoid a repeat of the Covid-19 pandemic, when rich countries secured the bulk of vaccines.

Okonjo-Iweala said 35 African countries were dependent on food imported from the Black Sea region.

“I think we should be very worried. The impact on food prices and hunger this year and next could be substantial. Food and energy are the two biggest items in the consumption baskets of poor people all over the world,” Okonjo-Iweala said.

“It is poor countries and poor people within poor countries that will suffer the most.”