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How Belarus Makes Profit Out Of Russia-Ukraine Sanctions?

The Naftogaz group has started to import petroleum products from Belarus for sale in Ukraine. Meanwhile, Belarus actively uses the sanction-based relations between Russia and Ukraine increasing its exports.

Fertilizers

Recall that Belarus has recently become major supplier of fertilizers to Ukraine – earlier it was Russia.

Gradually, following nitrogen and potassium fertilizers, Belarus increased its deliveries in the most popular category – three-component fertilizers (NPK).

The total delivery of local mineral fertilizers to southern neighbours is now estimated at $ 200 million. Noteworthy, there are three large producers of fertilizers in Belarus, so there’s no surprise.

Coal

Belarus is one of major suppliers of coal to Ukraine. Deliveries increased since Russian companies are now required to monthly receive permits from the government to export coal.

The measures were a response to Kyiv’s restrictions on the import of Russian goods. For the first six months of 2019, Belarus purchased 1.35 million tons of coal in Russia for almost $93 million.

Photo: Reuters

Compared to last year, physical volumes grew 4.9 times, foreign exchange earnings – 4.2 times. In the first half of this year, Belarus shipped 1.2 million tons of coal abroad for $ 101 million.

In physical terms, deliveries grew 9.7 times, in monetary terms – 8.4 times. Ukraine accounted for the bulk of deliveries. In January-June this year, 1 million tons worth $ 83 million were shipped.

In quantitative terms, deliveries grew by 472 times, in monetary terms – by 458 times. Coal is shipped to Ukraine from Belarus by rail, while Russia is identified as the product’s country of origin.

A dozen Belarusian companies mainly registered from 2014 to 2019 carry out coal supplies to Ukraine. There’s a chance that growth of supply will continue – the heating season in Ukraine is near.

Fuel

For years, Belarusian automotive fuel has been a leader in the Ukrainian market. Volumes could have been even bigger if it was not for Russia’s ban on the supply of its oil products to Belarus.

Belarus bought oil products from Russia and instead of using for own purposes, sold them to Ukraine, among other countries, earning more than a billion dollars.

The Kremlin considered that Minsk can provide itself with gasoline, diesel fuel and gas and blocked the Belarusian re-export to Ukraine. Recently, Ukraine introduced a special duty on the import of Russian diesel fuel.

Kyiv hopes to compensate for the lost volumes by deliveries from other countries. According to unofficial sources, the Ukrainian authorities have already held talks with Minsk in this regard.

Military industry

Another export category is dual-use goods. Belarus does not officially sell military products to Ukraine to maintain its status of a neutral platform for resolving the Ukrainian crisis but…

It is no secret that Belarus supplies the Ukrainian army with spare parts, special fabrics and other goods. Ukrainian companies buy fuel from Belarus for the needs of the Ministry of Defense of Ukraine.

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Earlier in the year, the military acquired the bulk of Arctic diesel produced by the Mozyr Oil Refinery. Deliveries of optics, night vision devices, sights, and thermal cameras from Belarus increased as well.

The Ukrainian military is also familiar with Yukon Advanced Optics Worldwide, the company with Belarusian roots, which is registered in the USA, Lithuania, Russia and China.

Cheese

However, the supply of products goes not only to Ukraine. Last year, there were reports on Belarus importing Ukrainian cheese into Russia under the guise of products from Macedonia, China, Iran and San Marino.

The representative of Rosselkhoznadzor Julia Melano said that up to 25% of cheeses on the Russian market can be of Ukrainian origin. This year, Gomel businessmen were sentenced for illegal entrepreneurial activity, including for the supply of Ukrainian cheeses to Russia.

However, Ukraine still has not been able to restore pre-crisis volumes of export supplies, 80% of which accounted for Russia. In January-August, the export of cheese from Ukraine decreased by 19.5%, to 4.3 thousand tons, while imports grew 1.6 times, to 12.5 thousand tons.

Air

Regular flights between Russia and Ukraine were closed at the initiative of Ukraine in 2015. Belavia has become one of the companies that could ensure the transit of passengers between the countries.

Then the Minister of Infrastructure of Ukraine stated that sanctions were imposed against Russian airlines violating Ukrainian law by flights to the Crimea, which was annexed to Russia illegally.

Authorities noted that Russian airlines “have to refuse to fly to Crimea and pay a fine for the National Security and Defense Council of Ukraine to consider the possibility of removing such airlines from the ban list.”


Source: TUT.BY

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