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What does Russia's loss of its position as a preferred trade partner mean?

What does Russia’s loss of its position as a preferred trade partner mean?

The Saudi expert in international trade, Dr. Fawaz Al-Alami, said that Russia’s exit from preferential treatment in trade exchange will cause major problems in Russian exports and imports, whether in goods or services.

Al-Alami added, in an interview with Al-Arabiya, that there are 4,000 foreign companies operating in Russia, explaining that these companies will be affected by the deletion of Russia from the list of “the right of the first country to sponsor trade”, which will cause the prohibition of preferential benefits in trade.

Alami expected that customs duties will be imposed on trade with Russia, in addition to the existence of technical obstacles.

He stressed that Russia will be severely affected, especially as it is the fifth largest country in the world for retail sales, with a value of up to 570 billion dollars last year.

Al-Alami indicated that commodity prices will rise significantly for the Russian consumer, but at the same time it will affect Western foreign companies that import commodities from Russia such as precious metals to America and natural gas to Germany.

He revealed that global supply chains will be affected by Russia’s classification as an unfavorable partner for trade, because there are countries and companies that have stopped dealing with Russia, such as Maersk companies – the largest shipping company, knowing that maritime transport constitutes 90% of the global trade volume.

He continued, “There are difficulties that Russia will face in the future, because China – which is the largest exporter of goods in the world – exports goods worth a trillion dollars to Europe and America annually, while its trade with Russia does not constitute more than 130 billion dollars annually.”

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And the international trade expert suggested that China would be neutral and would not be able to risk losing trade with Europe and America, for Russia’s sake, adding: “Russia will be negatively affected because China will indeed not stand with it.”