Financing Russia’s War Machine
EU imports of Russian fertilizers are providing revenue for Russia’s war against Ukraine
EU imports of Russian fertilizers are providing revenue for Russia’s war against Ukraine. Every tonne of fertilizer imported to the EU from Russia directly finances the war.
The EU imported €1.5 billion worth of urea-based fertilizers from Russia in 2022 and 2023, providing much-needed foreign currency (Euros) to Russia.
%
On 1 October 2023, Russia introduced a temporary export duty of up to 10% on fertilizers to finance the war effort.
On 1 January 2024, a law on excess profit taxes came into force in Russia. The Ministry of Finance announced that €600 million (20%) of the €3.15 billion collected in 2023 was from fertilizer exports.
What can Europe do?
Europe must explore all possible restrictive measures.
Restricting EU purchases of Russian fertilizers would deprive Russia of access to hard currency, hampering its ability to buy war supplies. Additionally, Russia would be forced to sell more fertilizers to other countries, potentially pushing prices down, similar to what occurred after the oil price cap was imposed.