25.04.2025, 22:07
Nabiullina assessed the impact of trade wars on Russia
Source: OREANDA-NEWS
OREANDA-NEWS The head of the Bank of Russia, Elvira Nabiullina, stated that trade wars have minimal direct impact on the Russian Federation due to low trade turnover with the United States, while for Russia the impact of duties is more indirect - through weaker global demand and lower global commodity prices.
"Trade wars have different effects on different countries. It depends on the structure of foreign trade, whether the increase in US import duties directly affects how much these import duties increase and whether the country takes retaliatory measures, whether it raises its duties on imports from the United States. In fact, it depends on how its foreign trade is organized. If a country used to export a lot of its goods to the United States, and now it will become less profitable due to tariffs, then they will try to redirect these goods to foreign markets, which is not always possible, but also to the domestic market," she said during a press conference.
According to her, this is the situation in China and some other countries, and therefore the government there provides support to its consumers so that they can buy these goods. "At the same time, there will be no adverse consequences for prices of this support, although there may be pro-inflationary consequences from a retaliatory increase in its own duties on imports from the United States," Nabiullina said.
"The situation in Russia is different. Our exports from the USA are insignificant. And there is no need to stimulate domestic demand in place of falling external demand in these conditions, so for us this direct impact is minimal. For us, the impact of tariffs is manifested more indirectly, primarily through weaker global demand, lower global commodity prices, and this is not a disinflationary risk, as in Japan or China, but a completely pro-inflationary risk," the head of the Central Bank emphasized.
On April 2, US President Donald Trump signed a decree imposing "reciprocal" duties on imports from other countries. Their base rate is 10%, and since April 9, increased rates have been applied for 57 countries, which were calculated based on the US trade deficit with a specific country: so that instead of a deficit, there would be a balance. However, on April 9, the American leader announced that more than 75 countries had not taken retaliatory measures and had requested negotiations, so basic import duties of 10% would apply for 90 days for everyone except China.
"Trade wars have different effects on different countries. It depends on the structure of foreign trade, whether the increase in US import duties directly affects how much these import duties increase and whether the country takes retaliatory measures, whether it raises its duties on imports from the United States. In fact, it depends on how its foreign trade is organized. If a country used to export a lot of its goods to the United States, and now it will become less profitable due to tariffs, then they will try to redirect these goods to foreign markets, which is not always possible, but also to the domestic market," she said during a press conference.
According to her, this is the situation in China and some other countries, and therefore the government there provides support to its consumers so that they can buy these goods. "At the same time, there will be no adverse consequences for prices of this support, although there may be pro-inflationary consequences from a retaliatory increase in its own duties on imports from the United States," Nabiullina said.
"The situation in Russia is different. Our exports from the USA are insignificant. And there is no need to stimulate domestic demand in place of falling external demand in these conditions, so for us this direct impact is minimal. For us, the impact of tariffs is manifested more indirectly, primarily through weaker global demand, lower global commodity prices, and this is not a disinflationary risk, as in Japan or China, but a completely pro-inflationary risk," the head of the Central Bank emphasized.
On April 2, US President Donald Trump signed a decree imposing "reciprocal" duties on imports from other countries. Their base rate is 10%, and since April 9, increased rates have been applied for 57 countries, which were calculated based on the US trade deficit with a specific country: so that instead of a deficit, there would be a balance. However, on April 9, the American leader announced that more than 75 countries had not taken retaliatory measures and had requested negotiations, so basic import duties of 10% would apply for 90 days for everyone except China.
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