Bulgarian Expert Predicts Big Damage from Russian Ban on Food Imports

Business | August 8, 2014, Friday // 16:02|  views

Plamen Grozdanov, Executive Director of the "Made in Bulgaria Union", photo by BGNES

Plamen Grozdanov from the "Made in Bulgaria Union" has predicted huge losses for many Bulgarian companies due to Russia's 1-year ban on food imports.

In a Friday interview for the Bulgarian National Radio, Grozdanov, former Ambassador of Bulgaria to Russia, suggested that Bulgaria had negligible or no exports of milk and dairy products and chicken meat to Russia, adding that the obstructions to a promising market such as the Russian one would have a substantial negative impact on many small and medium-sized companies.

Russia announced Thursday it was imposing a 1-year ban on food imports from the EU, US, Canada, and Norway. The product list included meat, dairy, fruit, and vegetable imports. Dmitry Medvedev made clear that the ban was effective immediately.

"Some companies have made substantial investments on this market over the past few years and this ban can really create serious problems for them. When a market is closed, it is very difficult to return to it," Grozdanov stated.

He noted that the Made in Bulgaria Union had distributed a declaration urging the government to stop watching in silence and take decisive steps, demanding that Bulgarian exporters be compensated and seeking to secure alternative markets for them.

Grozdanov pointed out that the export of that group of products amounted to as much as EUR 12-14 B, meaning that the ban would result in over-production and surplus quantities on a common market in which Bulgaria was a participant.

He argued that the trend would automatically lead to tougher competition and possible unfair commercial practices, including dumped prices, on certain markets.

"Taking into account that foreign goods of this type are much more subsidized than their Bulgarian equivalents, as well as the different conditions for producers in other EU countries, a steep price decrease, which others will be able to afford for a certain period of time, will be absolutely unaffordable for Bulgarian producers," Grozdanov reasoned.

He went on to suggest the Arab market, Germany and the Far East as alternative export destinations.

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Tags: Made in Bulgaria Union, Plamen Grozdanov, Russia, food producers, exports


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