The principles of the World Trade Organization were literally “trashed” by Western politicians who imposed sanctions on Russia, declaration Russian President Vladimir Putin at a meeting on the situation in the metallurgical industry. The President perceives the restrictions on the work of Russian manufacturers as a manifestation of unfair competition.
“Reducing the welfare and quality of life of ordinary citizens, especially in Europe, is not of interest to Western politicians. Not to mention things like adherence to WTO principles – it just gets trashed,” said Putin.
According to him, “Some of our Western partners don’t even want to remember these principles because it’s embarrassing to talk about it.”
He noted that restrictions on the work of domestic metallurgists “are a clear indication of unfair competition.”
“We see this in other industries as well – (sanctions) are attempts by Western countries to make Russian trade one of the leaders in world metallurgy and redistribute markets in their favor,” he added.
That said, Russia will continue to be a responsible supplier of metal products abroad, regardless of “political troubles”.
“Russia will always be a reliable and responsible supplier of metallurgical products for foreign buyers and partners, whatever the political problems of today. We will also be reliable partners for those who depend on profitable, predictable commercial cooperation.”
However, he also noted that Russia would not work to its detriment with countries that were “openly hostile”.
On June 24, Putin at the BRICS meeting declarationThe fact that global trade is sinking into disputes that increasingly take WTO principles into account. Its impact is felt most strongly in Asia, Africa, Latin America and the Middle East, where food, energy and commodity costs are rising rapidly.
“The entire international monetary and financial system is shaken, production logistics and investment chains are falling apart,” he said.
Export problems
On July 20, the owner of Novolipetsk Iron and Steel Works (NMLK) said that after the imposition of sanctions, exports of steel products from Russia became almost meaningless. According to him, the industry accounted for 40% of exports.
“Some of the exports are covered for us, current Asian destinations, especially China, are quite difficult in terms of logistics and freight costs. Especially in China, there is a surplus of steel production, so we supply them with products at the cost level,” he said.
He added that if earlier exports were the “engine of volatility” and low prices in the domestic market, export supply now works in the opposite direction.
sad prediction
By guess From mid-June, NMLK, ferrous metallurgists can reduce steel production by 15% by the end of the year. The biggest decline will occur in the second half of the year. Flat product production will suffer the most and slab (one of the steel billet types) production will suffer the least.
Previously, the forecast for the Russian metallurgical industry was given by the Worldsteel Association. They believe that steel consumption in Russia in 2022 could decrease by 20% to 35.1 million tons compared to 43.9 million tons in 2021. The previous forecast assumed that consumption growth in Russia would be 3% in 2022. The Ministry of Industry and Trade does not agree with this prediction and expects a single-digit decrease.
Putin, against the backdrop of the increase in the cost of metal products after the introduction of sanctions against Russia on May 20 instructed The government will take steps to reduce prices in the domestic Russian market. As the first measures the authorities can take, including the optimization of the tax burden on Russian metallurgists and coal miners, and the change in the tariffs for electricity and transport services of Russian Railways for metallurgical enterprises. In response, by a decree of 28 May, the government introduced tariff quotas for ferrous scrap and waste exports.