RUSSIAN ENERGY EXPORTS DOWN, FOOD IMPORTS UP.

Data just released by Russia’s Ministry of Foreign Economic Relations in the context of inter-CIS negotiations show that Russia continues reducing energy supplies to CIS member countries. For the period January-November 1995, Russian deliveries of gas, crude oil, and petroleum products were down in volume by 9 percent, 19.5 percent, and 57 percent, respectively, against the same period last year. Despite higher unit prices charged by Russia, the reduced volumes caused for the first time a net decline in the value of energy exports to CIS countries. Owing mainly to this development, the value of Russia’s overall exports to CIS countries for this period declined by 3.5 percent against the same period last year, despite an actual growth in Russian deliveries of other minerals and raw materials. The latter factor enabled Moscow to post a positive trade balance–at $12.4 billion worth of exports and $11.5 billion worth of imports–with the CIS countries taken together. The value of the imports in this equation was up by a spectacular 24.2 against the same period of last year, mainly on account of foodstuffs imported by Russia from CIS countries. Meat and meat products, butter, beet sugar, and grain led this import surge. The Ministry warned that Russia faces the prospect of incurring deficits in its trade with the CIS countries if this year’s dynamics continue. (11)

Russian oil and gas exports to CIS countries have been declining because of those countries’ industrial recession, conservation measures, quest for alternative suppliers, and not least because Russia has increased prices to near world market levels despite the partner countries’ limited solvency, resulting in an accumulation of arrears. Moscow’s attempts to collect through its preferred method–acquiring industrial ownership rights in CIS countries–have yielded meager results thus far. The decline in energy deliveries does nothing to increase Russian leverage over CIS countries. The latter may be developing some counterleverage if Russian imports of foodstuffs from these countries continue to increase.

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