Russian goods are unlikely to be decoupled from Europe

Russian Ambassador to the EU Vladimir Chizhov announced on December 27 that, despite mutual economic sanctions introduced nearly five years ago, trade turnover between Russia and the European Union (EU) has grown steadily since the beginning of 2017.

"Since the beginning of 2017, bilateral trade between Russia and the countries of the European Union has shown a dynamic growth trend. This trend has been reinforced this year," said Vladimir Chizhov.

According to Mr. Chizhov, citing statistics, in the first three quarters of 2018, trade turnover between Russia and the EU increased by 21.5% compared to the same period last year. Russian exports to EU countries increased by almost 30% while imports increased by 7.4%. The trade volume even exceeded the period when Western sanctions against Russia were introduced.

"In fact, the current growth is mainly a recovery from sanctions. Meanwhile, Russia's trade with a number of EU member states, such as Portugal, Belgium, Ireland, Cyprus, Denmark, Romania, has already exceeded the trade figures of 2012," Chizhov added.

Of course, the diplomat also did not deny that rising prices for energy products - Russia's main export to Europe, as well as currency fluctuations are the main basis for the increase in two-way trade between Russia and the EU.

Russia continues to set new records for gas deliveries to Europe

However, the Russian diplomat assessed that statistics showing increased Russia-EU trade are "a normal trade logic, despite the negative political developments towards Russia in the West".

Russian Energy Minister Alexander Novak said on December 25 that Gazprom, the country's energy giant, is expected to export record amounts of gas to European countries next year. Novak said that Gazprom's long-term export contracts have reached their maximum annual level this year, meaning that Gazprom needs to sign additional gas pipeline contracts (to increase gas exports).

It is clear that despite criticizing Russia on many international issues, Russian goods are something that is difficult to separate from for Europe and this makes the sanctions less effective.

Speaking to Russian business representatives on December 26, President Vladimir Putin said that Russia needs to improve its economic competitiveness through scientific development and localization of production in response to Western sanctions.

"We must increase the global competitiveness of our economy. We need to significantly accelerate the pace of industrial development, strengthen the scientific and technological base, and at the same time promote the localization of production and develop new markets for Russian companies both at home and abroad," Putin stressed.

The optimistic figures from Russia-EU trade are the clearest proof of this view of President Putin.