Crimea has learned to circumvent sanctions

Technically, Crimea is experiencing a catastrophic decline in foreign trade, but in reality a Peninsula littered with imported goods, but local factories, including the state, no problem selling their products abroad. Because in the Crimea do not go to foreign ships and aircraft of the Peninsula do not fly abroad, almost all imports and exports go to bypass sanctions through the port of Novorossiysk, located in the mainland of Russia.

Formally, the import of the Republic of Crimea in 2016 compared to the previous year fell by 43.5% to 66.5 million dollars, export — 40% to 47.7 million dollars, follows from the data Cristata. Import of Sevastopol was reduced by 12.6% to $ 33.4 million, exports — for 73,3% to $5.9 million dollars, according to the materials Sevastopolskaia.

The total foreign trade turnover of the Peninsula in 2016, thus, amounted to 153.5 million, which is by 92.1% less than in 2013, when the Peninsula was under the control of Kyiv ($1 billion of imports and 905 million dollars of exports).

Despite the strong formal reduction of foreign trade activity of the Crimea, it remains highly confident in terms of sanctions. In the large shops of the Crimea not short of imports. In a particular shopping center “monsoon” in Sevastopol, you can buy almost any foreign goods, ranging from Italian pasta factory Pastificio Gallo Natale, to consumer appliances by Bosch, LG, Philips and computer Intel.

Note that 67% of imports to the Republic of Crimea comes from (in descending order) Belarus, Italy, Turkey, Switzerland, Armenia and China, the data of the Crimean customs. A large portion of imports are food products, agricultural products, machinery, equipment and vehicles.

At first glance, the source of this import looks weird if you consider that foreign ships in Crimea almost does not go, and Simferopol airport, although it has a cargo terminal, performs overseas flights, said the interlocutor at the airport. “Some of the flights are performed with goods in the direction of Moscow, but further movement is not known to us,” said the source. Even if the airport serves part of the import or export of the Crimea, its contribution in foreign trade should be negligible, since air transport is the most expensive.

Foreign shipowners try not to get involved with the sea ports of the Crimea in connection with the political situation. “We have been approached with the request to organize the export of goods from Armyansk to India, the source said in the unitary enterprise “Crimean sea ports”. But none of the foreign companies did not agree to send to us court. Eventually solved the problem through an additional transhipment at the port of [Russian city] of Novorossiysk. Most of the import and export of the Peninsula runs through it. Between Novorossiysk and the Crimea go Russian court, but carry including import and export goods”.

There are several freight forwarding companies that deal with import of goods to the Crimea and export it through the port of Novorossiysk, but in all the firms declined to comment. The St. Petersburg company “mongoose” performs “international and domestic transport of goods to the Crimea”, Novorossiysk firm “YugTrans-Forward” organizes “sea shipping from anywhere in the Crimea”, Simferopol company “Import Crimea” offers to arrange the importation of goods to the Crimea “from any point of the globe, including from Ukraine.”

“YugTrans-Forward” correspondent addressed under the guise of a potential client who needed to deliver in Sevastopol 3,65 tons of tiles, Polis Ceramiche factory, located in the Italian city of Modena. “We don’t do teams of goods, but if desired it can be arranged. However, it would be very expensive. You send the offer in the mail, we will count and map the route”, — said in the company, but the letter was not answered.

The practice of involving the Novorossiysk port in the external economy of the Crimea is confirmed by one of the official sources. In early may, a Hong Kong company Logistics Consulting Group presented at the Yalta international economic forum the project of the Crimean exports of wheat to China in the volume of 450-500 thousand tons per year. “In accordance with the terms of the Chinese side, the wheat will be supplied in bags to be sent to China by sea in containers through the port of Novorossiysk. Thus between Crimea and Novorossiysk will be organised by the local sea container line”, — stated on the forum website, although in reality such a line already exists (container ships from port to port are two of the day and on the day of arrival emptied, loaded and go back).

“Organization of regular container service between the Crimea and China, will make available to the Crimean exporters and importers of the markets, in ports which come vessels carrying containers on the way from Novorossiysk to China, including the middle East, Iran, Pakistan, India, Southeast Asia, Korea and Japan,” — said the organizers of the forum on China company.

Perhaps the involvement of the port of Novorossiysk in the supply of the Crimea due to the increase of the turnover, which from 2004 to 2013 was fairly stable and hovered around 110-120 million tons, and in 2014, suddenly began to rise steadily. In 2014 it grew to 121,5 million tons, in 2015 — up to 127,1 million, in 2016 — up to 131,4 million.

Among the main end-recipients of export products of the Republic of Crimea, according to the FCS, in descending order — China, Ukraine, Belarus, and India. These countries account for 84% of exports, including, oddly enough, Ukraine — 29% (13.9 million dollars). Almost the entire export consists of three types of products — machines, equipment and vehicles, chemical products and food products and agricultural raw materials.

Many major manufacturers do not hide it. For example, machine-building plant “Fiolent” sells Belarus and Kazakhstan equipment for ships and power tools. Winery “Massandra”, nationalized by the office of the President of the Russian Federation, in 2016 put almost 200 thousand bottles in Belarus, China and Ukraine. Crimean soda plant implements abroad baking soda.