The cost of Russian import ban

The Estonian Institute of Economic Research has put a number on last month’s Russian ban on the import of food products, fish, meat, and fruit and vegetables from EU nations.

The direct loss is only 75 million euros, the sum of the banned products exported to Russia annually, while that figure doubles as many raw ingredients are exported to neighboring countries, which would have been processed and sent to Russia.

Cheese manufacturers are suffering the most, with their losses calculated at 27 million euros. Raw fish and fish products make up 15 million euros annually in exports to the eastern neighbor, with milk and dairy products in a similar bracket.

Losses from indirect exports to Russia are hitting the dairy industry the hardest.

Marje Josing, the head of the institute, said the figures are food for thought for companies which have failed to diversify markets, adding that businesses have played safe in comfortable schemes of selling raw material, instead of adding value or trying to crack Scandinavian or German markets.

She said looking at the bigger picture, the food industry is growing in the world, and demand is increasing.

Source: ERR News

Estonian companies buying airtime in pro-Kremlin media

Some 150 Estonian enterprises and organizations, including Health Sickness Fund, are advertising their products in pro-Kremlin state media channels such as RTR Rossija which is also available in Estonia, writes Äripäev.

One of the largest advertisers was the Estonian Health Insurance Fund, a state organization. Such advertising is politically tricky because the ads are aired near Vesti, the station’s news programme that broadcasts Moscow’s official views.

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Estonian officer abducted to Russia at gunpoint

According to the Internal Security Service (ISS), Estonia’s national agency for counterintelligence and high-profile corruption investigations, one of their officials was abducted at gunpoint at Luhamaa border checkpoint this morning where he was discharging service duties, and taken to Russia.

Correction: The deputy director of ISS said that it had been claimed to him by the Russian side that Kohver was alive and well, but no confirmation of that fact was available, or of Eston Kohver’s whereabouts.

Initially there was little indication it was necessarily more than an isolated criminal incident, but within several hours it had developed into a diplomatic row, with the Estonian and Russian intelligence agencies advancing cardinally opposite versions of the events.

Read more from ERR News

FSB, the Russian Federal Security Service, has stated a different version of events in the case of the missing counterintelligence agent, saying they stopped a Estonian Internal Security Service (ISS) operation in the Pskov Oblast near the Estonian border, and arrested an ISS operative.

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Products meant for Russian market can be sold in Estonia

Russian-bound food turned back at the border can be sold in Estonia if special permission has been granted by the Veterinary and Food Board and the sale outlet is furnished with Estonian-language information, the agency’s director said. To this point no company has pursued this option.

“It is allowed in exceptional cases to market food packaged for the Russian market in Estonia, if a company needs to do so,” said Ago Pärtel, the director general of the Veterinary and Food Board, on ERR radio.

Meanwhile, Pärtel said, the agency has been sending out letters to far-flung markets to inquire about import requirements for milk products. The countries included Indonesia, Taiwan, Kenya and Tanzania.

Russian Prime Minister Dmitri Medvedev announced on August 7 that Russia would slap a one-year ban on all EU, US, Australian, Canadian and Norwegian meat, dairy and produce. In particular, the Estonian dairy and fishery sector could be heavily impacted.

Source: ERR News

Governemnt pledges to seek new export markets

With the Agriculture Ministry saying the EU is unlikely to decide support for sectors hit by Russian sanctions before September, Estonian officials and producers focused today on what the national government can do. The focus will lie on finding new markets and working with banks to secure more favorable terms for dairy farm investors.

Agriculture Minister Ivari Padar and Foreign Trade Anne Sulling said after meetings with lobby groups today that the sanctions were a political conflict between the EU and Russia and a united front would have to be agreed on the EU ministerial level. A meeting is due to take place in Brussels on Wednesday.

But domestic efforts will also be at center stage for now, with ministries pledging to work with banks to institute grace periods for dary farm investors and possibly to roll out more export subsidies in the 2015 state budget, Padar and Sulling said.

Farmers and milk producers said going into the meeting that they expect decisive action, including more direct subsidies and government intervention on milk prices.

Read more from ERR News

Estonian President slams Swiss for being sanctions holdout

President Toomas Hendrik Ilves says Switzerland, which refrained from joining most of the rest of Europe in applying punitive sanctions against Russia, has placed its own interests and banking sector ahead of European values.

“Switzerland will have to live with criticism that they have foregone establishing their own sanctions in order to gain a more favored situation in the banking sector,” Ilves told the Swiss newspaper Sonntagszeitung, published Sunday.

In contrast, he said, Sweden and Ireland have affirmed neutrality yet supported sanctions.

“For me, the idea of neutrality is even more devoid of meaning than ever before,” Ilves said.

Ilves would not say whether the EU planned to pressure Switzerland, uudised.err.ee reported. The Swiss currently are president of the OSCE; critics have seen the country as a haven and business center for wealthy Russians.

Source: ERR News

PM: Exporters to Russia must have backup plan

Today, Russia released the detailed list of prohibited import goods, which establishes a blanket one-year ban on EU, US, Australian, Canadian and Norwegian meat, seafood, dairy products and produce. The Estonian head of government maintained that Russian consumers would suffer most, while Estonian agriculture as a whole would not be deeply impacted, but said Estonian export businesses should have have a plan B in place for the next year.

Estonian Prime Minister Taavi Rõivas said at today’s Cabinet press conference that Estonian agriculture would suffer less than the business sector.

“It’s too early to say what the impact on Estonia will be, but of larger categories of goods, 24 percent of dairy exports go to Russia. Export to Russia makes up 5.5 percent in the case of meat products and close to 9 percent for vegetables.”

According to Postimees, Estonia’s total export to Russia in 2013 across all types of goods starts with 127.7 million euros in drinks and beverages to Russia, followed by 50.2 million euros in milk and dairy products, 15.0 million euros in fish products, 12.1 million euros in grain, starch and milk-containing products, and 11.5 million euros in other foodstuffs. Other categories, including non-food items, were at 5 million euros or less.

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