Moldova prefers Europe over Russia

Russia is taking steps to lift the boycott of Moldovan fruit. Still, the Eastern European country chooses the EU over Russia. Russia is inspecting companies in Lithuania. After Hungary, Cyprus and Greece, it's now the Baltic country's turn. The inspection is necessary to gain access to the Russian market. The preserves industry in Russia is profiting from the economic situation. Russians are hoarding preserves because of the high inflation. The inspection again stopped a shipment of Egyptian citrus. At the end of the month, the EU is to make a decision regarding the sanctions: to continue or not? According to Russia, a majority of the EU appears to be in support of the sanctions. Russian retailers prefer imported produce, and prices have gone up significantly in Crimea.

According to the president of Moldova, the 4 million inhabitants of the country would rather seek alliance with Europe than with Russia. According to president Nicolae Timofti, the country benefits from the closer ties with the EU, and travelling without a visa. Nevertheless, Russian interference in the country remains an issue. "We have to face reality. For years we were part of a union dominated by Russia," Timofti says. "But we are a European country, and our people have European ambitions. We're better off living in a European family than in any other political union." Moldova is one of the poorest countries in Europe. Last week, the EU turned out to be reluctant regarding the promise of EU membership to former Soviet republics.

The Russian phytosanitary service is reconsidering the boycott of Moldovan cherries, plums, peaches, nectarines and apricots. The reports were confirmed by the National Agency for Food Safety in Moldova. The export could be resumed when Russian inspections have visited the Eastern European country.

Together with Belarusian colleagues, the Russian phytosanitary service is visiting companies in Lithuania. The inspections are necessary to be allowed to export to Russia. The companies involved work with animal products. For now, the boycott applies to Lithuania as it also applies to the EU. Last month, Russia inspected various companies in Hungary, Greece and Cyprus. During the inspections, it's checked whether the conditions of the Eurasian Economic Union and the Russian criteria are adhered to.

Growth for Russian preserves industry
Although the Russian economy is still going through a rough time, and consumer trust isn't very high, one sector appears to profit from the situation: preserves. According to estimates, the preserves industry will perform above average in 2015. The growth is caused by households which, encouraged by the high inflation, are investing in preserves and stockpiling. The boycott of fresh fruit and vegetables keeps prices high for these products. The urge to stockpile mainly benefits preserves manufacturers that produce locally, such as Bonduelle. This multinational previously indicated in financial figures that sales in Russia are growing. FruitInform reports that the preserves manufacturers want to increase production this season by at least a third, because of the quickly growing demand.

Again, the Russian inspection stopped a shipment of citrus because of the Mediterranean fruit fly, FreshFruitPortal reports. This time it was 72 tonnes of oranges that were imported through St. Petersburg. The inspection found larvae of the fly among the citrus. On May 22, a 120-tonne shipment was already stopped for the same reason. The shipment was accompanied by a phytosanitary certificate with international standard.

Deadline EU decision sanctions loom
With the approaching deadline for the EU to take a decision regarding continuing and/or expanding the sanctions against Russia, there are reports of countries speaking out against the sanctions. Former president of France Valery Giscard d'Estaing talked to Russian media about the sanctions last week. He sees no merit in the sanctions, because they disrupt trade. The Italian minister of Foreign Affairs, Paolo Gentiloni, is visiting Moscow. He told Russian media that there have always been talks, and relations between the countries hasn't frozen. He also expects relations between Russia and the EU to improve.

The Russian side has more pessimistic sounds. "It seems that support for expanding the sanctions against Russia in the EU is bigger than the resistance," Alexei Pushkov, head of the foreign-affairs committee in the State Duma, told TASS. Kiev, Alexei said, would want to make use of the situation by undertaking military actions and blaming Russia for those.

Laughing at high prices
Australian journalist Fiona Clark lives in Russia. On the dw.de website, she writes about the situation in Russia and researches what the ordinary Russian notices of the sanctions: "Russians may sometimes think I'm crazy, but there are moments when I walk around the supermarket and laugh out loud when I see the prices. That's better than bursting into tears. Blueberries cost 16 Euro per tray (125 grammes), and I see a berry mixture for nearly 20 Euro. Who pays prices like that?" That is equivalent to 10% of the average weekly wage of a Muscovite. Prices for other products have also increased sharply. Read the full report with Fiona's experiences here.

Russian retailers want imported produce
Russian supermarkets prefer to buy imported products. Russian MP Elena Panini explained what drives the chains in Russian newspaper Pravda. "Some chains are owned by a foreign party. For them, it's more profitable to import. In addition, the presentation of the imported products is better." It's also attractive for retailers to divert funds to other countries and leave them there. The Russian goal of having 50% domestic produce on shelves, is perhaps aiming a bit too high. "50% is a lot, and Russian producers aren't able to produce that much. It would also be bad for the consumer. In Europe, the norm is 15%."

High prices on market Crimea
The indicator for prices in Simferopol in Crimea has been the market in Privoz for years now. The market isn't just visited by the small trader, but retailers wanting to save money also buy there. In May, the prices are traditionally lower, but this year there is no such decrease in price. Where apples in the 'expensive winter months' normally cost 50 roubles, a kilo of apples now yields 70 to 100 roubles. Compared to bananas and oranges, the apples are expensive. Bananas and citrus cost 70 to 80 roubles. According to the traders, the cause is the Russian demand for apples. Importers in Moscow are willing to pay a lot for the apples, which means growers in Crimea drive up the price.

Prices for other products are also high. Potatoes cost 85 to 100 roubles, from storage 25 to 30 roubles. Courgettes: 80 to 90 roubles, eggplants from Turkey: 120 to 175 roubles, Bulgarian bell peppers: 250 roubles. Local strawberries yield 130 to 150 roubles, those from Ukrainian Kherson are 180 roubles. On average, prices are 1.5 to 2 times higher than normal. In the lead-up to summer, prices are expected to go down, but by how much is not yet clear.

Read all articles from Dossier Russia here.