Russia has responded to UK sanctions with an exports ban
From cars in the North West to medicinal and pharmaceutical products in Wales, exporting and importing goods to the increasingly-pariah state is worth tens of billions of pounds to UK firms.
UK businesses do not face a blanket ban on trading with Russia.
But many Western firms are halting their operations in the country, while economic sanctions are making it “very, very difficult” for British businesses to continue to trade.
The UK Government said the situation should be “a wake up call” for businesses with commercial interests in Russia.
NationalWorld has analysed the latest figures to find out how much Russian business is worth in communities across the country, and the most valuable commodity exported or imported in each region.
How much is trade with Russia worth to the UK?
HMRC data shows the UK imported £18.1 billion worth of goods from Russia in 2021.
Goods are grouped into 10 broad categories. Last year, the highest value category of imports was a miscellaneous group of ‘commodities or transactions not classified elsewhere’, at £11.1 billion, or 61.4% of imports.
Further analysis reveals this was entirely made up of trade in ‘non-monetary gold’ – such as gold bullion. This was followed by ‘mineral fuels, lubricants and related materials’, such as petrol (£4.5 billion, 24.7%).
Imports were worth far more than exports – but the UK still sent £2.8 billion of goods to Russia in 2021.
The highest value category of exports was machinery and transport equipment, at £1.5 billion, or 53.4% of the total, followed by chemicals and related products, at £648.2 million (23.3%).
When looking at specific types of goods, rather than categories, the highest value export was cars and other motor vehicles for transporting people (£341.8 million) and the highest value import (excluding gold bullion) was petroleum oils and oils obtained from bituminous minerals (£2.2 billion).
Separate data from the Office for National Statistics (ONS) on the trade in the services sector shows the UK exported £974 million worth of service business to Russia in 2020 (the latest available data), and imported £433 million.
This however excludes trade in travel, transport and banking services.
How has trade changed over time?
The value of imports from Russia to the UK has almost tripled since 2014 – when Russia invaded and illegally annexed the Crimean region of Ukraine.
In 2014, imports totalled £6.4 billion. By 2021, that had risen by 181%, to £18.1 billion. The bulk of the increase was down to imports of non-monetary gold, but even when this is excluded imports rose by 14%.
The value of exports decreased by 31% over the same period however, from £4 billion to £2.8 billion – but was still at a four-year high in 2021.
How many businesses trade with Russia in each part of the UK?
HMRC publishes regional data on the imports and exports of goods, although data is not yet available for the whole of 2021. This excludes trade in non-monetary gold, because so much of it is centred in London.
In 2020, the figures show 3,789 businesses across the UK exported goods to Russia, while 1,240 imported them.
The South East was home to the highest number of exporting businesses (970), followed by London (748) and the East of England (646).
The same three regions were also home to the highest number of importers – South East (336), London (276) and East of England (257).
If a business operates or employs people in multiple regions it will be counted in each one, but only once in the national total.
Trade data for the services sector is not broken down regionally.
What is trade with Russia worth in each part of the country?
HMRC’s 2020 data is also broken down into smaller geographical areas.
By number of businesses, south Eastern and London areas dominate the rankings of exporters and importers, particularly ‘Berkshire, Buckinghamshire and Oxfordshire’, ‘Surrey, East and West Sussex’, and ‘Inner London West’.
But when looking at the value of goods traded, the picture shifts slightly.
Businesses in the ‘West Midlands’ area (not the entire region, but one part covering built up areas including Birmingham, Coventry and Wolverhampton) exported the most goods to Russia by value, coming in at £187 million.
This was followed by ‘Shropshire and Staffordshire’ (another of the three areas the West Midlands region is divided into) with £139 million, and ‘Surrey, East and West Sussex’, with £138 million.
By imports, ‘East Yorkshire and Northern Lincolnshire’ comes in second, with £582 million worth of trade. ‘Inner West London’ was first (£1.9 billion) and ‘Surrey, East and West Sussex’ was third (£406 million).
You can explore the value of imports and exports by these local areas in the map below. Trade is allocated to a region according to the proportion of its employees that are based there.
What type of goods does each region trade with Russia?
HMRC’s regional data also shows what type of goods were traded in each part of the country – although this is not available at a more local level.
‘Petroleum, petroleum products and related materials’ was the highest value import category in most regions in 2020.
But in Northern Ireland, ‘cork and wood’ were the highest value products, while in London it was ‘non-ferrous metals’, which includes copper, lead and aluminium.
In the East Midlands, ‘power generating machinery and equipment’ such as turbines and engines were the highest value imports.
It is a more mixed picture when it comes to exports.
Scotland’s biggest export market was in beverages – which would include the whisky industry.
And in Wales and the East of England, trade was dominated by ‘medicinal and pharmaceutical products’.
Other categories that came top across the regions included ‘road vehicles’, ‘general industrial machinery’, and ‘power generating machinery’.
In London, the top category was ‘miscellaneous manufactured articles’. The regional data does not go more specific than this, but this category includes antiques, works of art, and jewellery, among other articles
What are the rules on trading with Russia?
Current UK sanctions outlaw exporting some technology, energy-related, aviation and space goods, as well as goods traded under a ‘dual licence’ which means they could potentially have a military function.
But there is currently no outright ban on trading with Russia – although in practice business activity may be hampered by other sanctions, such as a ban on Russian ships in UK ports.
The Institute of Export and International Trade (IOE&IT )– a professional membership body for businesses – said the effect on British companies was “dramatic”.
It said businesses were “weighing up the moral, reputational and practical risks”, and also called for government support for firms impacted by a loss in trade.
“The situation in Ukraine is first and foremost a humanitarian crisis, the effects of which are being endured by the people of Ukraine and increasingly the innocent people of Russia,” said director general Marco Forgione.
“The financial sanctions that have been imposed on Russia are having a very significant effect. They make doing business with Russian companies very, very, difficult and the risks are likely to be too high for the vast majority of companies.”
Almost 1,500 business people attended a recent webinar held by IOE&IT on complying with sanctions, and it is continuing to advise companies through its helpline.
The Federation of Small Businesses (FSB) said in many cases small UK firms have been winding down their trade in Russia for some time.
National chair Martin McTague said: “We support the need for the UK Government to act internationally to protect the lives and freedoms of others, including through sanctions, and have been working with the Department for International Trade to get information to the firms that will be impacted by these necessary measures.
“Larger corporates usually have the resources to keep across changing compliance requirements, but this isn’t the case for most small firms.”
What does the Government say?
A spokesperson for the Department for Business, Energy and Industrial Strategy said: “Whilst this is ultimately a commercial matter, we welcome the growing number of organisations and governments joining the whole international community in isolating Russia, both diplomatically and financially.
“Putin’s unprovoked invasion of Ukraine must be a wake-up call for British businesses with commercial interests in Russia.”
A spokesperson for the Department for International Trade added: “We advise any UK businesses who operate in Ukraine, Russia or Belarus and have queries to contact our Export Support Service and seek our latest guidance.”
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