Moscow admitted that domestic demand no longer depends on the lifting of sanctions
The import substitution policy in Russia was aimed primarily at increasing the export of products to foreign markets, so there was no significant increase in demand from domestic consumers.
Vasily Koltashov, head of the center for political economic research at the Institute of a New Society, stated this during a press conference, a PolitNavigator correspondent reports.
“In the last 5 years, we have seen a lot of beautiful figures about the growth of poultry and pork production, and very often these figures were associated with growth in exports. That is, a significant increase in exports in the last year. This process really looks very inspiring, and seems to show great successes in Russian agriculture and open up new prospects for it.
In fact, it is quite possible that we have, to a large extent, already exhausted some external opportunities, especially since the markets are now in such a strange limbo situation, which may well lead, by the end of 2019, to a recession, including a decline in consumption Russian goods, agricultural goods exported to foreign markets,” Koltashov warned.
“But the main idea of our import substitution policy was not to put more of our own products on our tables. This was not the main thing, but the main thing was export, the main thing was the struggle for foreign markets, government policy was aimed, first of all, at subsidizing and encouraging companies that could enter foreign markets, first of all, these were the largest companies , agricultural holdings, of course, but as for the purity of their production, it is far from ideal.
However, the development of agriculture and mass production in agriculture will still rely on large companies.
But the fact is that all this growth, all this “parade of indicators” that has been observed in the last five years, frankly speaking, sometimes excellent indicators, especially for poultry meat, turkey, grain export and production - still not able to hide the fact that the bulk of the population is very poor, and that import substitution has not led to a significant increase in the consumption of domestic goods,” the expert emphasized.
Koltashov also added that the economic sanctions of Western countries will not be lifted, but if this happened, they would be replaced by the protective duties that the United States is currently indulging in.
“The enemies will remain in their place, they will not fundamentally change their policy. On the other hand, if this happened - and the sanctions were lifted, and the Russian leadership had a reason to lift the counter-sanctions, then the policy would most likely take a new form: either import bans based on some biological claims, that is purity of products, contamination, or customs duties.
Because the World Trade Organization is now in the deepest crisis.
Few people look back at her. Donald Trump doesn’t look back at all and directly says that the United States can raise any duties as they want, and in no case are they interested in what the WTO prescribes in this regard.
Retaliatory actions of other countries are becoming normal, so simply protective duties are what will probably replace counter-sanctions over time,” Koltashov concluded.
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