The impact of sanctions on Russia’s trade flows: Preliminary Estimations

Russia - 5 September 2017

Trade topics: Other

The purpose of this research is to examine the impact of sanctions on commodity composition and direction of exports and imports of the Russian Federation. To this end, we use a panel data over 2012–2016 to estimate the three-sector gravity model, which, in addition to standard variables, include dummy variables capturing the effect of sanctions imposed on Russia. Our findings confirm that the Western sanctions have a considerable impact on Russia’s trade pattern. A significant negative effect of restrictive measures was revealed in Russia's trade with both developed countries and members of the Eurasian Economic Union. Direct political conflicts with Ukraine and Turkey have a particularly strong negative impact on bilateral trade with these countries.

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