Irish government gets primed for lifting of sanctions against Russia

Irish government gets primed for lifting of sanctions against Russia
By Jason Corcoran December 10, 2015

The Irish government is getting itself ready should the 28-member European Union decide to lift sanctions imposed against Russia in mid-2014 over its actions in Ukraine.

A 16-strong delegation from the Irish foreign affairs and agriculture ministries met with their Russian counterparts on December 7-8 to discuss how both countries can expand and develop trade. 

The delegation sent to Russia, the biggest in many years, was led by Simon Sherlock, the Minister of State for Development and Trade Promotion. Their visit was to mark the 10th anniversary of the establishment of the Russia-Ireland Joint Economic Commission, which aims to stimulate trade between the two countries.

"We believe it's very important to keep all channels open with our partners in Russia," Sherlock told bne IntelliNews. "Despite the current tensions, it's very important to build on our existing excellent relationships."

Ambassadors representing the EU member-states decided on December 9 to delay a decision to extend by six months economic sanctions against Russia after Italy called for a debate on continuation of the political sanctions.

Italy and several other southern European states have shown some reluctance to maintain the sanctions, which have "packed a powerful economic punch" to Russia, Radio Free Europe/Radio Liberty (RFE/RL) quoted from the report on December 10.

However, the measures and Russia's retaliatory ban on EU food has also hit European businesses hard, including the agricultural sector in Ireland. The ban includes all beef, pork, poultry, fish, dairy, cheese and vegetables from Ireland and the other EU states.

Russia had been one of Ireland's fastest growing export destinations with the value of food exports jumping 440% between 2009 and 2013. Food exports to Russia hit a record €235mn in 2013 while overall Irish firms exported goods and services to Russia worth €637mn,

Ireland's food exports to Russia effectively ground to a halt in the first six months of 2015, dropping by 75%, as Moscow's trade war with the West intensified, according to the Irish Central Statistics Office.  Exports sank to €145mn in 2014 and have continued falling since.

KerryGold, a renowned Irish brand, had been finding a strong foothold in Russia prior to the sanctions for its premium butter and cheese products. The cheeses and butter had been heavily promoted by the Irish Dairy Board at Moscow's popular annual St Patrick's parade.

The worst-hit sector for the Irish was pig meat, which accounted for about a sixth of total exports, worth €59mn, prior to the ban. 

Zalina Abdusalamova, the managing director of Kings Meat, renowned among expats for its English-style sausages, told bne Intellinews the firm had to turn to Brazilian meat after the ban prevented her firm from buying Irish pork.

The countries with the highest food exports to Russia include Lithuania, Germany, Poland Denmark and the Netherlands.

A senior aide for Ireland's agricultural ministry quipped to bne IntelliNews that the only thing Ireland was selling to Russia right now was "a drop of the hard stuff". The sanctions do not cover imports of alcohol, including popular Irish brands in Russia such as Guinness, Baileys, Jameson and Bushmills.