Sanctions permit the sale of Russian oil and gas to most of the world to continue uninterrupted. And a spike in prices has boosted revenues further
Save time by listening to our audio articles as you multitaskRussia has stopped publishing detailed monthly trade statistics. But figures from its trading partners can be used to work out what is going on. They suggest that, as imports slide and exports hold up, Russia is running a record trade surplus.
On May 9th China reported that its goods exports to Russia fell by over a quarter in April, compared with a year earlier, while its imports from Russia rose by more than 56%. Germany reported a 62% monthly drop in exports to Russia in March, and its imports fell by 3%. Adding up such flows across eight of Russia’s biggest trading partners, we estimate that Russian imports have fallen by about 44% since the invasion of Ukraine, while its exports have risen by roughly 8%.
Imports have collapsed partly because sanctions on the Russian central bank and the expulsion of some lenders from theinterbank messaging network have made it harder for consumers and firms to buy Western goods. Elina Ribakova of the Institute of International Finance , a bankers’ group, says that regulatory uncertainty was also a big factor at first, as Western firms were unsure which Russian banks came under sanctions.
Russia’s exports, meanwhile, have held up surprisingly well, including those directed to the West. Sanctions permit the sale of oil and gas to most of the world to continue uninterrupted. And a spike in energy prices has boosted revenues further.IIF reckons that in 2022 the current-account surplus, which includes trade and some financial flows, could come in at $250bn , more than double the $120bn recorded in 2021. That sanctions have boosted Russia’s trade surplus, and thus helped finance the war, is disappointing, says Mr Vistesen. Ms Ribakova reckons that the efficacy of financial sanctions may have reached its limits. A decision to tighten trade sanctions must come next.
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