By: Bianca and Mimi
After Russia’s invasion of Ukraine, many global companies halted sales to them in response. However, the government in Moscow recently announced that they would allow parallel imports. This system allows Russian companies to purchase goods from any country outside of theirs, that earlier purchased their goods legally. Parallel goods serve as a type of distribution channel, providing a driving force for foreign market pricing. By putting together, a list of goods for things like foreign carmakers, technology companies, and consumer brands, domestic consumers are protected against isolation.
While the volume of imports will still be lower than what they previously were due to supply chain and logistics issues, parallel imports will likely help with the shortages that consumers had previously seen. However, it is quite possible that producers will add on additional restrictions to comply with sanctions, with extra incurred costs likely resulting in a rise in costs. But will producers be willing to look the other way when their products start to head towards Russia? Or will they pull out of the country altogether, refusing to return?
Kerry, F. (2022, April 18). Russia publishes list of ‘parallel imports' goods. Reuters. Retrieved May 16, 2022, from https://www.reuters.com/business/russia-publishes-list-parallel-imports-goods-2022-05-06/