Press-releases of the Embassy

On measures to implement the Presidential Executive Order On Applying Certain Special Economic Measures to Ensure the Security of the Russian Federation.

Excerpts from Prime Minister Dmitry Medvedevs introductory remarks during the Government meeting.

7 August 2014

Good afternoon, ladies and gentlemen. Before we start discussing the agenda, I would like to inform you of the following: For a long time, Russia has not responded to the so-called sanctions declared against it by certain countries. Until the last moment, we hoped that our foreign colleagues would realise that sanctions lead to a blind alley, and that no one benefits from them. But they didnt realise this, and now we have been forced to respond.

Yesterday, the President of the Russian Federation signed an Executive Order On Applying Certain Special Economic Measures to Ensure the Security of the Russian Federation. This basically means an embargo on importing entire categories of products from those countries which have declared economic sanctions against Russian organisations and individuals. I have signed a Government resolution on enforcing this Executive Order.

Russia has completely banned the importation of beef, pork, fruits and vegetables, poultry, fish, cheese, milk and dairy products from the European Union, the United States, Australia, Canada and the Kingdom of Norway. Of course, this is a serious decision with regard to the distributors of these products from the above countries. At the same time, I would like to emphasise that these measures will not affect baby food imports. And, naturally, they dont apply to products being purchased by individuals in these countries in line with our customs legislation.

These restrictions shall be introduced starting today, and for a period of 12 months. But, if our partners display a constructive approach towards cooperation issues, then the Government would be willing to revise the specific implementation deadlines for these measures.

I hereby instruct the Federal Customs Service to carry out and enforce this directive as quickly as possible. In other words, it shall stop the shipment of the relevant products. The Ministry of Industry and Trade and the Ministry of Agriculture will start monitoring the commodity markets and price levels on a daily basis, and they shall report their findings to the Government.

I would also like to warn everyone that any attempts to obtain speculative profits from this situation will be stopped and held accountable. The Ministry of Agriculture, the Ministry of Economic Development, the Ministry of Industry and Trade and the Federal Anti-Monopoly Service shall enhance their cooperation with retail chain representatives and producers. They shall hold meetings and consultations, and they shall chart a joint action plan in order to compensate for product shortfalls and, of course, to prevent price hikes.

I have repeatedly stated that there is nothing productive about sanctions. We had a hard time deciding on retaliatory measures, and we were forced to make this decision. But I am confident that well be able to take advantage of the situation even under these conditions.

While touring the country and meeting with farmers, we have repeatedly heard complaints that Russian retail chains and shops do not allow the sale of Russian foodstuffs. You have also heard and seen this many times. The retaliatory measures that we are introducing will essentially open up shop shelves for domestic producers. Of course, Russian farmers will have to accomplish a lot and work hard, but this opportunity to launch and expand import-substituting production facilities should not be missed. Naturally, our trade partners from other countries will still cooperate with us on the entire range of the above items.

The Food Security Doctrine that was approved four years ago is being implemented effectively with regard to a considerable number of foodstuffs. For example, grain, sugar, vegetable oil and potato production volumes now exceed the threshold levels being stipulated by the Doctrine. The same is true of poultry and, in principle, pork.

Where we are lagging behind is in certain kinds of meat and milk. We should fill in the gap on our own, and our farmers are ready to do this, especially with our help. Again, I repeat: our trade partners from other countries are still working with us. I am sure that our market will be filled with fresh quality Russian products, which anyway many Russians prefer to the imported ones.

The next thing Id like to focus on is that we are also developing measures to retaliate against the EU sanctions against Dobrolyot for its service to Simferopol. As you all know, on 4 August our first low-cost carrier was forced to suspend operations as a result of these unfriendly acts. All of its European partners refused to meet their obligations to lease, provide maintenance or insurance for planes or to provide air navigation data. This has brought many problems to our people that weve had to deal with. In this context, the Russian Government is considering a series of responses. Ill name them. This doesnt mean theyll be taken right away, but they are on the table.

First, they include an airspace ban against European and US airlines that fly over our airspace to Eastern Asia, namely, the Asia-Pacific Region. This is a very tough measure indeed. Nevertheless, it should be mentioned.

Second, we are considering changing the so-called Russian airspace entry and exit points for European scheduled and charter flights. This, of course, will affect transportation costs and fare prices for the Western carriers.

Third, this country is ready to revise the rules of using the trans-Siberian routes, that is, to denounce the agreed upon modernisation principles of the existing system. This revision will apply in full to the EU countries. We will also discontinue talks with the US air authorities on the use of the trans-Siberian routes.

Fourth, starting this winter, we may revoke the additional rights issued by the Russian air authorities beyond the previous agreements.

Id like to emphasise that all these measures are not being introduced yet, but otherwise can be implemented either separately or together. As a result, the expenses of Western airlines will grow significantly. I repeat, we are only considering these steps now, but the Government has already taken one specific decision.

Were referring to the suspension of Ukrainian airlines transit flights through Russian airspace to a number of countries Azerbaijan, Georgia, Armenia and Turkey.

Finally, were potentially ready to adopt protective measures for the aircraft, shipbuilding and auto industries as well as other industries, but well do these things in a measured manner. The Government realizes the significance of cooperation in these spheres, so naturally were taking a realistic approach while considering our own opportunities.

I repeat that all Ive just said, all the measures Ive mentioned are simply responses. We did not want this to happen, and I sincerely hope that our partners economic pragmatism will prevail over malevolent political considerations, that they will think matters over, rather than intimidate or impose restrictions on Russia, and that mutually profitable trade and economic cooperation will be restored to its former level. We would very much hope for that.