Vladimir Putin’s decision to launch a full-scale invasion of Ukraine has drastically altered the composition of trade flows between his country and the European Union, as dozens of bans, restrictions and controls imposed by Brussels work to stifle what used to be a close and steady commercial relationship.
The 10 rounds of EU sanctions slapped on Moscow in retaliation for the aggression on Ukraine have sent a sizable share of imports and exports plunging, a painful economic turnaround that has forced the Kremlin to find alternative markets to replace the wealthy bloc.
Since February 2022, the EU has banned over €43.9 billion in exported goods to Russia and €91.2 billion in imported goods, according to the latest numbers provided by the European Commission.
This means 49% of exports and 58% of imports are now under some sort of sanction, compared to the pre-war levels of 2021 when the total EU-Russia trade was worth €257.5 billion.
Back then, Russia was the bloc’s fifth largest trading partner, right behind China, the United States, the United Kingdom and Switzerland.
Today, Russia is the most sanctioned country in the world and has become a trading pariah in the eyes of the entire West.
Vodka, crude oil and Prada bags
The EU has restricted exports to a varied range of industrial and technology products that Brussels considers are either already being used by the Russian army to wage war on Ukraine or have the potential of ending up doing so.
These include radars, drones, camouflage gear, cameras, lenses, radio systems, cranes, antennas, trucks and chemicals found in the manufacturing of weapons.
On top of that, the EU has prohibited valuable exports that are essential to modernise Russia’s economy, such as semiconductors, quantum computing, oil-refining technology, aircraft components and banknotes of any of the bloc’s official currencies.
Brussels has also imposed a so-called “luxury ban” on EU-made goods sought after by the Russian elite, such as pearls, jewellery, handbags, purses, wallets, wigs, perfumes, antiques, porcelain, wine, champagne and cigars, but only if they exceed the €300 price tag.
Meanwhile, EU products like medicine, soap, coffee, cocoa, tea, toys, trees, plants and dyeing liquids, as well as clothing and fashion accessories below €300, all remain allowed to be exported.
In fact, European apparel brands like Boggi, Benetton, Calzedonia, Etam and Lacoste are among the companies still doing business in Russia.
On the side of imports, the economic value under sanctions is even higher: €91.2 billion in Russian goods are now banned across the bloc, such as coal, gold, iron, steel, machinery, cement, wood, plastics, textiles, footwear, leather and vehicles, among others.
Two of Russia’s most iconic and coveted produce – vodka and caviar – are equally prohibited from entering the EU market.
The latest addition to the import blacklist is carbon blacks and synthetic rubber, an issue that proved surprisingly controversial and almost caused the last round of sanctions to miss the bloc’s symbolic deadline for approval.
Still, no measure compares to the EU ban on imports of Russian crude oil and refined petroleum products, which directly targets Moscow’s main source of revenue and has been widely identified as the bloc’s most daring and far-reaching sanction until now.
Although the ban featured tailored-made exemptions for pipeline imports, it managed to gradually remove around 90% of EU purchases of Russian oil, estimated to be worth €71 billion in 2021.
The EU ban was further strengthened by a G7 price cap, which artificially sets the price at which Russian tankers are allowed to use Western companies to ship oil barrels across the world.
The Centre for Research on Energy and Clean (CREA), an independent research organisation based in Helsinki, estimates the EU ban and the G7 cap are costing Russia up to €280 million per day, despite Moscow’s strong push to redirect discounted barrels to China, India and other non-Western buyers.
By contrast, natural gas, nuclear fuel and diamonds are among the most notable Russian exports yet to be touched by penalties, attracting the fury of Kyiv and hard-line European capitals.
“As for the 10th sanctions package, we are not happy with it because it is too soft, too weak,” Polish Prime Minister Mateusz Morawiecki said last week.
“We propose that additional people be included. We’ve been suggesting for a long time that additional Russian products be included.”