The Cabinet of Ministers of Ukraine has imposed new economic sanctions against goods produced in Russia on May 15.
The restrictions come as Kyiv’s response to Moscow’s recent ban on the sale of Ukrainian goods in Russia and their transportation through Russian territory to third countries during the past few months.
“Today we impose mirror sanctions on Russia, an embargo on goods that can be fully produced in Ukraine or can be replaced…,” Ukrainian Prime Minister Volodymyr Groysman said during a March 15 session of the Cabinet. “We introduce special duties on Russian goods as an answer to the aggressor who wants to harm the country economically.”
The ban applies to Russian cement, plywood, mineral fertilizers, certain types of industrial products, vehicles and some other products, according to Deputy Prime Minister and Economic Minister Stepan Kubiv.
“We want to prevent the outflow of capital from Ukraine to the aggressor state, to increase the capacity of domestic producers and, therefore, budget revenues,” Kubiv said.
In 2018, cement imports from Russia amounted to almost $17 million, while plywood imports reached $19.7 million, according to an official government website.
Experts see the ban as a positive step for Ukraine — at least, for Ukrainian plywood producers.
According to Evhen Kuzmenko, a committee’s manager at the European Business Association, the plywood embargo will protect the country’s economic interests and will help domestic plywood companies, which previously had unequal conditions compared to their Russian competitors.
According to Kubiv, the goods banned by Ukraine are valued at $510 million per year.
“We are redirecting our economy toward civilized markets with the rule of law,” said Groysman.
The embargo includes exceptions for economically sensitive imports such as coal, coke, gasoline, liquefied natural gas, and pharmaceuticals.
The sanctions can be lifted if Russia’s deescalates its trade war against Ukraine and if the country agrees to respect Ukraine’s territorial integrity and the right of other countries for self-determination, the prime minister said.
Additionally, starting on Aug. 1, Ukraine will impose a special duty on goods imported from Russia, in addition to the already existing duties.
The revenue from the new duties on Russian imports will be placed in a special fund to stimulate import substitution, according to the Ministry of Economy.
The same day as Ukraine imposed an embargo on Russian imports, the Kyiv City Council decided to ban the transfer of Kyiv’s communal property and land plots to legal entities that have a 25 percent share or more of capital rooted in Russia.
