UN notes negative after-effects from anti-Russian sanctions

UNITED NATIONS, December 11. /TASS/. The United Nations experts have unveiled a World Economic Situation and Prospects 2015 report stating that the Western sanctions against Moscow have had a negative impact on a number of European economies. "Weaker Russian import demand has already affected a number of EU economies, as the Russian market absorbs almost 5 per cent of the euro area’s exports,” says a report of the United Nations Department of Economic and Social Affairs (DESA), published on Wednesday. Experts say that the slowdown in the German economy in the second quarter of 2014 is partially explained by lower exports of automotive components to Russia. German producers have been also affected by the restriction on supplying deep-water drilling equipment to sanctioned Russian companies. The Russian ban on food imports “will mostly hurt those countries which are strongly exposed to trade with the Russian Federation, not only through direct losses by the agricultural sector, but also their consequential effects.” "By contrast, some countries, among them Argentina, Brazil, Serbia and Turkey, as well as some CIS economies, may benefit from the current situation, becoming alternative food product suppliers to the Russian Federation," the report reads. The report also notes dropping growth rates in the post-Soviet states. Experts say a “near-zero growth” is expected in Russia next year as the high cost of capital will deter private investment, and the possibility of deeper recession exists in Ukraine. Russia has come under Western sanctions, originally visa bans and asset freezes and later sectoral restrictions amid the Ukrainian crisis. In response, Moscow imposed on August 7 a one-year ban on imports of beef, pork, poultry, fish, cheeses, fruit, vegetables and dairy products from Australia, Canada, the EU, the United States and Norway. Read more