Share this
By Stehen Ubanna
The North American country of the United States, US, and its allies economic and trade embargo against the Russia Federation over its invasion of Ukraine appears ‘’to have reorganised global trade along political lines, defying geography and efficiency’’.
This new reality according to informed maritime sources has created a ‘’windfall for Merchant shipping and the risks are getting higher for European consumers and hunger for the people of the African Continent. This disruption, a shipping source had said stems from’’ the disturbing of the black sea trade by Russian forces’’.
The Russian forces had blockaded the Ukrainian ports from land to sea, thus impeding shipping activities. Yorgos Gour-dmichalis, a shipowner, had told Reuters News Agency that about 100 foreignagged vessels were trapped at the Ukrainian ports on Friday, March 11, 2022, alone, stressing that more are still being trapped.
Gour- Domichalis, had said that the cargo laden ships were in the process of loading and unloading when the Russian forces invaded the country on Thursday, February 24, 2022, thus shutting down the system. This is because there were no Ukrainian Customs personnel and Harbour masters to process the vessels out.
Given what is happening in Ukraine at the moment which is not favourable for ocean-going vessels may have informed why the United Nations, UN, Maritime Agency, International Maritime Organisation, IMO, has vowed ‘’to establish a safe corridor for Crew evacuation, but stranded ships are currently being crewed by skeleton Crews.
News making the rounds in Europe was that Some Merchant vessels were damaged by missiles and mine at the sea. One Estonia- owned ship was said to have sank on Thursday, March 3, 2022. With the Russia-Ukraine war still ongoing, a ship owner had said that Insurance Companies have taken advantage of it to hike their rates . The vessels insurance rates cited by the value News shows that it now ranges between $4000,000 to $6000,000 a week but a normal rate was said to be closer to $80,000 to $120,000 a week. It was not surprising why most dry bulkers are steering clear of the Eastern Europe because of the high insurance rates.
The situation is more worrisome as Ukraine has reduced almost 40% of the world’s sunflower seed oil, widely used in the food industry 15% of its barley and 10%of its wheat and maize. Indeed, the Russian forces blockade The Russian forces blockade of the Ukrainian port cities clearly shows that it cannot currently export these goods, forcing the European and African countries to look afield.
Records from the National Bureau of statistics, NBS, shows that Nigeria had imported $434.62 million, equivalent of N144 billion, worth of durum wheat from Ukraine in 2021. The country was said to have also imported milk worth N721 million or $1.7 million from the war- torn Ukraine . It was said to have imported $84.3 million in capital imports from Russia between 2019 and now.
The Russia-Ukraine war has affected Nigeria and the two East Europe countries which share mutual trade relations as both imports that have stopped since the outbreak of the war on February 24, 2022. The United Nations, UN, had said that due to the conflict, Ukraine is going from being the ‘’breadbasket of the worls to being on the breadline’’.
Niyi Adebayo, a former governor of Ekiti state and minister of Industry, Trade and Investment, had said that the worrisome situation in Russia and Ukraine, the two former member countries of the defunct Union of Soviet Socialist Republic , USSR, may have informed why President Muhammadu Buhari, a retired Army General, had mandated the ministry, trade Department ‘’to analyze the ongoing war situation between Russia and Ukraine as it concerns trade with Nigeria and come up with a result for approval.
The minister had said that officials of the trade department would be at all the issues involved since the war broke out and to look at what the country imports and export to the two countries in return with a view to coming out with a policy document.
He had said that the new trade policy with the two nations under the former USSR, with which it shares mutual trade relations, would go a long way ‘’ to immune the Nigerian economy from the numerous economic and trade sanctions from the US, European Union, EU, United Kingdom, UK and Canada, which is currently strangulating the Russian and Belarusian economy .
Mohammed Bello Koko, the Managing Director, of the Nigerian Ports Authority, NPA, at the instance of the Katsina state born Nigerian President was said to have perfected plans ‘’to commence a twenty –four ports operations to solve the challenge of port congestion in Lagos ports arising from the Russian-Ukrainian war’’.
There is no gainsaying the fact that the on-going war between Russian and Ukraine which had affected trade between Nigeria and the two countries that may have encouraged the Nigerian government to intensify efforts ‘’to bridge the wide gap in sugar production.
Adebayo, who has been given a target by the retired Army General to ensure that in the next 10 years, the country would achieve 100% self- sufficiency in sugar production and also export sugar produced in the country to the West and Central African sub-regional markets including Europe and Asia is working towards achieving the goal.
I n a related development, the 27 member EU.economic bloc, are yet to agree on the imposition of total sanctions on Russia over its invasion of Ukraine last February. The EU embargo on Russia, a source said, would require the unanimous approval from all the 27 member countries.
Olaf Scholz, the Germany Chancellor, whose country’s economy had depended so much on the Russia oil and gas, was said to have warned other western Leaders about the dangers of taking ‘’hasty steps to impose sanctions on Russia’’.
The Germany Chancellor, may be reluctant to join other EU, countries in placing embargo on Russia on the grounds that ‘’it could push the economy into recession ‘’.Russia Crude, has continued to account for about 14% of the intake of Germany’s largest refinery , Miro, and 24%, which is 24% owned by Rosneft.
Even Germany refinery, OCK Scwedt, which is 54% owned by Rosneft, receives its Crude oil from Russia through the Druzhba pipeline. The land-locked Leuna refinery in Western Germany, which majority shares owned by Total Energies, also receives its Crude oil from Russia through the Druhba pipeline.
But the following Germany Companies were said to have stopped buying Russian oil: KN Olen, Neste, Galp, Equinor, Baynoil, Eni, Eneos, and BP, Commodity traders, such as Trafugura and Vitol, were said to have continued buying Russian Crude under existing long term contracts.
Bulgarian refinery, allegedly owned by Russia’s Lukoil, also uses Russia’s Crude, which accounts for about 60% of its intake, was said to have continued to import the Russian Crude to keep the refinery busy.
Note that as a prelude to ending the over one month-old war, Vladimir Putin, the Russian President may have kept to his words to cut back drastically the country’ military activity around Kyiv, and Chernihiv in the war torn Ukraine, That much was confirmed byColonel- General Alexander Fomin, the Russian Deputy Defense minister on Tuesday, March 29, 2022, after talks between the country and Uraine Negotiating Teams in Istanbul, Capital of Turkey, at the instance of Recep Tayyip Erdogan, the Turkish President.
The Russian Deputy Defense minister had said that the decision to cut its military operations in Ukraine was taken ‘’in order to increase mutual trust and create the necessary conditions for further Negotiations and achieving the ultimate goal of agreeing and signing an agreement’’. He had said that that the decision was made by a wide margin by the Kremlin ‘’to radically reduce military activity in Kyiv and Chernihiv direction’’.
In spite of the fact that Russia had said that’’ it will fundamentally cut back’’ its offensive operations near Kyiv and Chernihiv to boost trust and talks with Ukraine, Volodymyr Zelenskyy, the Ukrainian President had said the promise was aimed at misleading its forces, stating that ‘’the country will not reduce its defensive efforts’’. He has urged the West ‘’to wait to see if the Russian will follow through on the de-escalation promise of the war before giving applaud to Putin for doing so. He has reason.
Hear him: Ukrainians have already learned during these 34 days of invasion and over the last eight years of the war in the Donbas region that the only thing that they can trust is concrete result. But the Britain’s ministry of Defense in an intelligence update had aid that ‘’it is highly likely that Russia will divert combat power from the north to their offensive in the Donetsk and Luhansk regions in the east.
Vaily Nebenzya, the Russian envoy to the UN, had accused the West of ‘’fueling the conflicts by sending weapons to Ukraine’’.
