Exports are halved
Trade with Russia collapses
2/10/2023 8:48 am
Foreign trade with Russia has fallen sharply due to the sanctions imposed as a result of the attack on Ukraine. The increase in imports is solely due to higher oil and gas prices. The Committee on Eastern European Economic Relations expects trade relations to be set back by decades overall.
Germany sold significantly fewer goods to Russia last year as a result of sanctions over the attack on Ukraine. On the other hand, imports increased in value. In total, goods worth 14.6 billion euros were delivered to the country – a drop of more than 45 percent compared to 2021, as reported by the Federal Statistical Office. “In the ranking of the most important buyer countries for German exports, Russia fell from 15th to 23rd place in a year-on-year comparison,” it said.
On the other hand, German imports from Russia grew by 6.5 percent to 35.3 billion euros due to the sharp rise in prices for energy – such as oil and gas – caused by the war. However, the volume of goods imported from Russia fell by 41.5 percent. “As a result, Russia fell from 12th to 14th place in the ranking of the most important suppliers of goods,” according to the statistics office. “Lack of energy imports from Russia were partly offset by supplies from other Eastern European countries, especially Kazakhstan.”
Highest import surplus since 1992
The balance of trade with Russia showed a deficit of 20.7 billion euros because significantly more was imported than exported. In 2021, the minus was only 6.5 billion euros. “Due to the high prices for energy imports and lower exports of goods as a result of the sanctions, German foreign trade with Russia recorded the highest import surplus in trade with Russia since 1992, the year the Russian Federation was founded,” emphasized the statistical office.
The most important German export goods to Russia were pharmaceutical products, as the health sector was exempt from Western sanctions. Their exports increased by 17.6 percent to 3.1 billion euros. Machine exports, on the other hand, fell by more than half to 2.8 billion euros, while exports of chemical products fell by 43.3 percent to 1.7 billion euros.
The Committee on Eastern European Economic Relations does not expect a rapid trend reversal. “The prospects for the export business with Russia remain bleak,” said its managing director Michael Harms recently. “The war and its consequences – sanctions, recession and loss of purchasing power in Russia as well as the ongoing withdrawal of German companies from the Russian market – set us back decades in bilateral trade relations.” Goods exports to Russia are likely to level off at a low level this year. “Since hardly any energy raw materials are now purchased from Russia, the trade deficit will also decrease significantly,” predicted Harms.