November 30, 2015

A THREAT ONLY TO HIS OWN PEOPLE:

Putin Takes Ineffectual Aim at Turkey (Leonid Bershidsky, 11/30/15, Bloomberg View)

On Monday, top government officials discussed ideas for punishing Turkey, and came up with a ban on the sale of package tours and charter flights, curbs on truck traffic and an embargo on fruit and vegetables. The latter won't be effective immediately: Deputy Prime Minister Arkady Dvorkovich said any measures must not lead to price rises. Russia's food embargo against most Western countries, imposed last summer, led to 20 percent to 30 percent price jumps. As it is, Russia reported an 11.7 percent drop in retail sales in October, compared with a year earlier. 

The fruit and vegetable embargo and the disruption to tourism are painful for both sides, but could hurt ordinary Russians most. Turkey's agricultural exports to Russia reached $1.2 billion last year, about 7 percent of total food exports. Turkish farmers probably will close the gap without much trouble. Last year, their counterparts in Europe experienced an increase in exports despite the Russian embargo.

For Russia, the loss is greater: About 20 percent of vegetable imports are from Turkey, as are about 90 percent of citrus fruit sold in major retail chains. 

And Turkey was by far the biggest tourist destination for Russians last year, attracting 3.3 million visitors, almost 19 percent of the Russian tourists who traveled overseas. Turkish resorts made billions, but losing this trade won't be a matter of life and death for the industry. According to the Ministry of Culture and Tourism, last July, at the height of the tourist season, Turkey received 686,256 Russian visitors and almost 3.1 million from Europe. 

The ruble devaluation has made European vacations too pricey for most Russians. Egypt, the second most popular destination last year, has been off-limits since a terror attack brought down a passenger plane last month. 

Posted by at November 30, 2015 6:04 PM

  

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