Ukrainian government threatens new sanctions against Russia over transit ban

The government is going to introduce ‘mirror sanctions’ against Russia over its most recent transit restrictions, First Deputy PM Stepan Kubiv told parliament leaders today. He said Russian transit would be restricted, and duties on Russian goods would be increased.

Yesterday, Vladimir Putin signed a document banning the direct transit of Ukrainian goods to the landlocked Central Asian country of Kyrgyzstan, and prolonging the ban related to Kazakhstan. Goods from Ukraine bound for Kazakhstan or Kyrgyzstan may enter Russia only via Belarus.

This will involve additional costs for exporters probably not only to Kazakhstan and Kyrgyzstan, but also to nearby China, which is one of Ukraine’s main export markets. The new measures against Ukraine will be effective till Dec 31, 2017.

Russia has been waging a trade war on Ukraine for several years, because of Ukraine’s signing a free trade agreement with the EU. Ukrainian food and several other goods categories are embargoed in Russia. Ukraine, for its part, introduced sanctions against Russia over the annexation of Crimea. The trade war with Russia has been affecting Ukraine’s growth, as Russia remains the main market for many local exporters.

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