Russia's ambassador to the UK: We must carry on trading

Russia and the UK have always been active trading partners, but today that relationship is being tested.

Click to enlarge the image. Drawing by Niyaz Karim

Ukraine is weighing heavily on the political dialogue and there are attempts to hamper our commitment to economic co-operation. This is not the right approach. Russian and British companies should continue to talk to each other and trade, helping to create jobs and develop larger markets and relationships with partners in other countries.

Politics should not dictate to business. That is why the Russian government takes a very careful approach in its response to the sanctions that have been imposed on it with unseemly haste. We do not want the situation to get out of hand because of short-term political tactics, for that would have long-term adverse effects for the economies of many countries. It can be a very dangerous precedent in our globalised world, where issues of development, rather than those of geopolitics, are paramount.

This is not to say that our governments do not play any role in this area of our ties, preferring a laissez-faire approach. On the contrary, in recent years the bilateral Intergovernmental Steering Committee on Trade and Investment has proved to be useful in easing some of the tensions arising from time to time because of regulatory or other imbalances and barriers.

Other useful official bilateral channels include the Energy Dialogue, the Liaison Group on Moscow as an International Financial Centre and the Joint Commission on Science and Innovation. These bodies cover some of the key areas of our bilateral co-operation – energy, including nuclear, finance and high technology. Despite the clear advantages that these formats can bring to interested companies, the British Government has taken a back seat in terms of driving the agenda forward. But what is at stake?

For now, our trade volume numbers seem to be keeping up – in the first three months of 2014 turnover stayed broadly flat compared to last year on the $5.5bn (£3.25bn) mark, with our exports to the UK growing some 5pc. In 2013 the UK remained the second most active foreign investor in terms of capital inflows ($18.9bn) and fifth in accumulated capital ($28bn).

We remain committed to fostering active commercial links between our companies and their partners from Britain and other countries, whether in large or small projects. Leading companies such as BP and Shell, Mace and JCB, AstraZeneca and GlaxoSmithKline, EY and PwC are now household names in Russia, while the City of London continues to provide Russian companies and entrepreneurs with additional support in terms of financial and legal services. Similarly, among some of the larger Russian companies present in the UK are Gazprom, Lukoil, VTB Capital, Alfa Group, Sberbank and Volga-Dnepr. They represent not just billions of pounds in turnover, but thousands of jobs both here and in Russia.

In difficult times like these, independent bilateral channels, free from political interference, have a special role to play: to keep calm and carry on. The Russo-British Chamber of Commerce is a good example. It remains determinedly apolitical in its activities, and that is exactly what its members need – a body that provides good advice while keeping a cool head. The annual RBCC Business Forum, to be held in London on June 4, will be a good platform to openly discuss the hopes and worries that the companies have, and to look into possible new opportunities and projects.

Alexander Yakovenko is Russian Ambassador to the United Kingdom. He was previously Deputy Minister of Foreign Affairs.

 

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