Grain combine harvesters mow wheat at Argostroy farm, some 450 km (280 miles) south of Barnaul city in the Altai region.(Reuters / Andrei Kasprishin)Russia has imposed a special duty on imported agricultural machinery to protect domestic manufacturers from a flood of imports triggered by WTO membership. After joining the Russian makers saw its profits fall 360%. The Eurasian Economic Commission (EEC) of Russia, Belarus and Kazakhstan said it was introducing a special additional preliminary protectionist duty of 27.5% on the imports of combine harvesters to the Customs Union, Vedomosti daily reports. The decision is set to become effective in 30 days and remain operational till July 5, 2013. After an investigation into agricultural machinery imports is finished in the summer, the EEC should decide on final protection measures, according to Andrey Slepnev, a Minister for Trade at EEC. A similar Russian investigation for imports of combine harvesters in 2008 resulted in a tripling of duty to 15%. Russian producers of agricultural machinery were among the hardest hit by the country’s entrance into
WTO, says Konstantin Babkin, a co-owner of Rostselmash, one of the world’s biggest producers of agricultural equipment. With Russia having become a full fledged WTO member, the import duties for combine harvesters fell to 5% for new vehicles, with the figure for the used vehicles nose diving 80%, Babkin said.This made the Russian market much more attractive for foreign producers, with imports jumping 92.3% year on year in 1H2012. This compares to a 19.9% increase between 2009 and 2011.Russian domestic production of combine harvesters was down 14.4%, with the sales dropping 43.4% and the bottom line shrinking by almost 80 per cent. Some other protectionist measures like State support, cheaper borrowing or stimulating exports should also be introduced Babkin concluded. The USA and the EU are the key suppliers of agricultural equipment to Russia.Experts have long been warning against the damage WTO membership could bring to Russia’s most vulnerable industries – like automotive, agriculture, forestry and light industry. The government plans to spend more than $1.47bn in 2013 – 2015 to back fragile industries.
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