As the supply chain fallout increases, the UK government have imposed a new economic sanctions package on Russia this week and increased tariffs on £900 million of goods by 35%, on top of current tariff levels.

Increased tariffs will see a goods list worth £900 million, which includes Russian vodka, facing a 35% import tariff and end Russia and Belarus access to “most favoured nation” tariff status at the World Trade Organization for hundreds of its exports, raising the barrier to trade with Russia.

SEE SUPPLY CHAIN SITUATION REPORT BELOW

The new tariffs will further isolate the Russian economy from global trade, ensuring it does not benefit from the rules-based international system it does not respect and builds on the UK’s efforts to starve Russia’s access to international finance, while exerting maximum economic pressure on Putin’s regime.

Additional sanctions have also been imposed on 370 more Russian individuals and a ban introduced on exports of luxury goods, bringing the UK in step with its G7 allies.

The export ban will include luxury vehicles, high-end fashion and works of art going from the UK to Russia. The Treasury will issue no new guarantees, loans or insurance for exports to Russia and Belarus and without government export credit support, any financial backing from the private sector to the region was “virtually impossible”.

The Department for International Trade said 54 licences for exports to Russia had already been voluntarily surrendered by UK businesses.

Government officials are hosting two webinars for businesses about the recent changes to UK sanctions relating to Russia.

UK Sanctions relating to Russia: Briefing by UK Government, Thursday 17 March, 13:00 GMT
The webinar will cover; sanctions legislation overview; new sanctions measures: financial, trade and transport; individual and entity designations; and humanitarian issues.
Register via Eventbrite

UK sanctions against Russia, Thursday 24 March, 14:00 – 15:30 GMT
The webinar will cover; the scope of sanctions, scope and application of trade sanctions; financial sanctions: restrictions and general licenses; the Export Support Service and enforcement of trade sanctions.
Further details can be found HERE, and you can register HERE

SUPPLY CHAIN ROUND-UP

Supply chain disruption has been mounting since Russian troops began to mass on the Ukrainian border last month, with container dwell times increasing around Europe, putting port operations under severe pressure.

The European Union, US, and other countries have banned Russia air carriers from using their airspace and without being able to fly over Russia, it is possible that some carriers may cancel their Asia-Europe services, further restricting already tight supply.

Carriers that do continue to fly from Asia will take alternative, longer and more costly routes, which will incur additional fuel costs and many are already introducing War Risk Surcharges, in light of costs of adjusting operations.

By far the most pronounced effect on freight rates will likely be in air cargo, with freight capacity from Asia declining 22% in a week, but a rise in ocean freight rates is also anticipated, with bunker prices rocketing and, potentially >1m teu of rail freight seeking a new mode.

Supply chains are facing new challenges and with conditions changing continuously we are working closely with our network partners, to monitor the situation locally and identify potential issues early, so we can take action to protect our customers.

We have relationships with air and surface carriers that have been built over decades, which means we have established lines of communication and access to a wide range of service options, that provide our customers with solutions, whatever the situation.