March 28, 2022 Socio-Economic Situation in Russia. Sanctions in Action

RF

YouTube Video Hosting has imposed restrictions on Russian Defense Ministry videos. Roskomnadzor is outraged by this decision and demands to remove all restrictions and explain the reasons for their introduction.

In March, Russians were buying used equipment by 16-35 % more often. This is evidenced by the data of advertising services “Ads VKontakte”, “Yula” and “Avito”. In particular, the demand for laptops and home appliances increased by 35%, and the number of devices sold increased by 23%. According to a study by Price.ru, household appliances in Russia since February 24 have risen in price by an average of 50%. This is due to the fact that the leading manufacturers of electronics and home appliances have decided to stop or suspend work in Russia, among them: LG, Samsung, Dell, Sharp, Apple, Nokia and others. At the same time, the number of fraudulent Apple stores has doubled on the Russian Internet.

After the invasion of Ukraine, almost twice as many Russians with a “financial strategy” (14%) increased their spending than during the coronavirus pandemic (8%), analysts at Russia's Super Job Research Center have said. 16,000 economically active respondents took part in the survey.

Roscosmos CEO Rogozin has said the commercial market for Russian space rockets has been closed.

From April 1, 2022, the Russian truck manufacturer KAMAZ will switch to the production of old models. The company will start producing trucks of the K3 generation - with a classic cabin, manufactured with varying degrees of modernization since the late 1960s. The reason for this decision of the manufacturer's management is the sanctions imposed by the West against Russia due to its invasion of Ukraine. They have caused a lack of parts for the manufacture of KAMAZ. In particular, the trucks were equipped with Cummins engines (USA); ZF transmission (Germany); fuel equipment from Bosch (Germany). Due to this, the K3 trucks will be manufactured in complete sets with Russian counterparts. That is, a priori they will be obsolete.

Demand for some drugs in Russia has increased tenfold. This was stated by Minister of Health Care Murashko on the air of the TV program “Moscow. Kremlin. Putin”. He also assured that the beneficiaries have stocks of medicines, which should be enough for five and a half months. And that’s it.

The head of the so-called “LPR” Pasichnyk wanted to hold a referendum on joining Russia. In response to this whim, the head of the State Duma Committee on CIS Affairs, Eurasian Integration and Relations with Compatriots Leonid Kalashnikov said that “now is not the best time to hold a referendum on the LPR’s joining the RF”.

Europe and the World

The People's Deputies of Ukraine together with the Ministry of Finance and the State Tax Service agreed on the concept of the draft law on additional taxation of companies that continue to operate in Russia. According to the draft law, the rates of direct taxes (on income and property) with a coefficient of 1.5 will be applied to such companies. Since the Russian invasion of Ukraine, more than 400 transnational companies have stopped doing business in Russia and left its territory, from oil companies to McDonald’s. However, according to Yale University, 42 companies are not leaving and are not reducing their activities in the Russian market.

Instead, the Office of the President of Ukraine will celebrate companies that have left the Russian market immediately after the start of Russia's full-scale aggression against Ukraine. Such corporations will receive a special “Peace Award”.

JSC Ukrzaliznytsia (UZ) calls for continuing the railway blockade of Russia and speeding up the decision to stop the transit route between China and Poland, which passes through Russia and Belarus. UZ also called in an official letter from members of the railway cooperation organization to stop transportation from Russia, as well as to exclude its representatives from participation in international organizations and deprive them of the right to make any decisions.

Authorities in Bavaria and Lower Saxony in Germany have imposed criminal liability for displaying the letter Z.

The Swiss insurance company Zurich Insurance has changed the logo on social media because of the letter Z, which was desecrated by Russia.

Sanctions against Russia may be the reason for the suspension of supplies of goods from Serbia to Russia, - said the assistant director of the Serbian Chamber of Commerce Bojan Stanic. “Further development of the political situation on the West-Russia line will affect Serbia's export potential, due to the risk of stopping trade flows between EU members and Russia, which could potentially stop the delivery of goods from Serbia. There are alternative routes, but the question arises of their economic feasibility, given the shelf life of products”, he said.

 According to Stanic, given this, some companies have already begun to prepare for a reorientation to alternative markets. Most of the goods supplied to Russia are fresh and dried fruits, mainly apples and strawberries. Prior to the imposition of international sanctions, Serbia also exported car tires, textiles, medicines, wrapping paper and cardboard to Russia.

Secretary of State for Foreign, Commonwealth and Development Affairs of the United Kingdom Elizabeth Truss demands to double sanctions against Russia.

The United Kingdom is suspending budget-funded research conducted with Russian universities and research companies, said British Science Minister George Freeman. “The government announces that it is suspending funding for all research programs related to Russia's government and institutional partners, and is suspending all ongoing projects that benefit the Russian regime. The United Kingdom will also not fund any new joint projects with Russia through its research and innovation organizations”, Mr Freeman said in a statement. He also added that the government will stop all remittances coming through British state funds in fields related to Russia. In addition, the country will pause the intergovernmental dialogue with Russia on science and innovation.

Prime Minister of the Czech Republic Petr Fiala has announced the freezing of the property of Russian businessmen in the country.

The global computer brand Hewlett Packard Enterprise has stopped doing business in Russia and Belarus.

Long before the start of international sanctions against Russia, Turkey began to take measures to get rid of energy dependence on Russia.

According to Turkish Foreign Minister Mevlut Cavusoglu, the country's dependence on Russian gas has fallen from 51% to 40% over the past four years.

At the same time, the head of the European Union's diplomacy, Josep Borrell, believes that Europe can give up Russian gas within two years.

Today, imports of all energy f carriers rom Russia to the EU account for about 22%.

Due to the war in Ukraine, Turkey is forced to look for alternative sources of food supplies to the country, - said President Erdogan.

The Canadian company and operator of the luxury hotel chain Four Seasons has stopped the development of business in Russia.