Throwing Euros Before Swine: EU Sues Russia For Not Buying Infected Meat
And now a story about European pigs and pork in general. Europe sued Russia for 1.5 billion euros. Who's right and who's wrong? Russia, who first imposed restrictions due to a plague or Europe that first imposed its political sanctions and then received an identical response?
Today, the story had a new episode in Moscow. The Ministry of Economic Development stated that the European claims were unjustified. Brussels responded that it's not the compensation that it wants but clarity regarding some issues. What could be unclear?
Vsevolod Smirnov with the details.
To pay for a nonexistent purchase. Brussels demands that Russia pay 1.4 billion euros for pork that wasn't sold. Moscow refused to import European products in 2014 due to an outbreak of the African Swine Fever in Poland and Lithuania. Afterward, meat was added to a list of counter-sanctioned products. Despite that, Brussels insists on conducting hearings in a WTO arbitration court. Experts believe their claims are unjustified.
Vladimir Djabarov, member of the Federation Council: "The damage done by the sanctions greatly exceeds the damage we inflict by refusing to buy European pork. The WTO got involved and sent the case to the International Court of Arbitration. Why now and not when illegal sanctions were being imposed against the Russian Federation?"
The Ministry of Economic Development called the claims unjustified because Moscow meets all the requirements of the WTO. Where does the sum 1.5 billion euros come from? The EU math is simple — it's the revenue Europe earned in 2013 by exporting pork to Russia. Brussels plans to increase the sum by 15% every year. Analysts believe that Russia is not expected to pay the money. The sum will fund further sanctions.
Vyacheslav Pronin, Analytical Center WTO-Inform: "We are not expected to pay the money. It's a response to our restrictions. If the court finds the European demands lawful, then the EU will be able to worsen the terms of trade for Russian companies by a similar sum. For instance, it might increase the import charges for our metallurgy".
On January 3, the EU sent its demands to the WTO. Despite the high paperwork processing speeds, according to the rules of the WTO, processing papers and making a decision can take up to several months.
Vyacheslav Evseev, Center for the Study of Customs Tariff and Non-Tariff Regulation: "Their official terms are five months. But in reality, the WTO system is overburdened, and the process may last up to a year. The first procedure defines the sum. There's also a second procedure that clarifies whether Russia had violated any regulation".
Currently, Russia prohibits all European pork imports, but the volume of imports is growing. According to 2017 estimates, Russia purchased 300,000 tons compared to 259,000 in 2016. For the most part, Russia obtains meat from one of the most lucrative pork producers in the world — Brazil.
Vsevolod Smirnov, Maria Basova Vesti