E-Malt.com News article: Russia: Putin approves secret deal to smuggle Scotch whisky into Russia

Vladimir Putin has approved a secret deal for Scotch whisky to be smuggled into Russia, amid its ongoing invasion of Ukraine, the Mirror reported on November 6.

The Kremlin boss has dodged an exports ban with the new deal that allows popular brands such as Bell’s, Johnnie Walker and Macallan across the border into Russia via a process called parallel imports.

Alternatively known as ‘the grey market’ it means goods can be supplied without the consent of the manufacturer, owner, or licence holder to get them into the former Soviet Union.

This sneaky backdoor into trading already covers around 200 big brands including Apple, Marvel, Disney Pixar and DC Comics.

But the Russian leader is now trying to get brands like Aberlour, Bowmore, Lagavulin and more onto the list, the Daily Record reports. Other products like Jägermeister, Jack Daniel’s, Jim Beam and Malibu are also being sought for import.

All were widely available in Russia until the country launched its brutal invasion of Ukraine and manufacturers announced the suspension of supplies.

Governments across the world including the UK, the US and the EU have slapped punishing sanctions on Russia and stopped or severely limited trade with the now largely pariah state.

Over a 1000 foreign firms also cut back or suspended operations in Russia, with hundreds quitting the country entirely.

This has created massive shortages in shops that Putin has scrambled to cover, to prevent economic collapse.

It was announced just this week that Russia’s economy contracted 5 per cent year-over-year in September, and by 4.4 per cent in the third quarter compared to the same period last year.

Many of the economic indicators paint a grim picture for President Putin who still has to fund his stalling invasion of Ukraine, already in its eighth month with no end in sight.

The move is an attempt to get around existing trade bans by sourcing the items from other supplies or nations that have not stopped trading with Russia, like China, India and Turkey.

Leaked Russian government documents show how Putin signed the law to legalise parallel imports in June 2022 against a backdrop of sanctions by countries like the UK, America and the EU.

On its website, Russia’s ministry of industry and trade explains the decision to have parallel imports, adding: “Import stimulation is aimed at those niches in which Russian production cannot yet fully meet the needs of industrial enterprises and end consumers.”

The Russian Association of Retailers asked Putin to allow parallel imports of alcohol, fearing a shortage of spirits due to the departure of the big international suppliers.

Cars, chemicals, household appliances, game consoles, clothes, shoes and toys are also to be imported through the grey market. Putin has ruled that any item not manufactured in Russia can be imported.

The Scottish Whisky Association said: “We continue to closely monitor the situation and pass on any relevant government guidance on exports to our members.”

A spokesperson for the Scottish Whisky Association said: “The industry is one of many sectors for which exports have been affected by the ongoing conflict.

“Our immediate concern remains the welfare of industry colleagues in Russia and Ukraine.

“We continue to closely monitor the situation and pass on any relevant government guidance on exports to our members.”



08 November, 2022