Trade is welcome: French businesses regularly turn to the Russian Embassy
Requests from French entrepreneurs to help them enter the Russian market are received by the Russian Embassy in Paris on a regular basis, the diplomatic mission told Izvestia. They emphasized that many small and medium-sized companies in the Fifth Republic survive thanks to trade with Russia. At the same time, Moscow does not refuse to continue supplying LNG to France, where it still exports fertilizers, nitrogen compounds and non-ferrous metals. At the same time, the expert community notes that the authorities of the republic do not provide any support to businesses remaining in our country. The Izvestia article discusses the trade relations between Russia and France and other European countries under sanctions.
Interests of French business in Russia
Despite the anti-Russian policy of official Paris and sanctions imposed by Brussels, the Russian Federation remains an important partner for many French companies, told "Izvestia" in the Russian Embassy in the Fifth Republic.
- It can be said that many French small and medium-sized firms survive thanks to supplies to our country. Requests from French entrepreneurs asking for assistance in entering our market come to the embassy on a regular basis," the diplomats said.
At the same time, the main representatives of French big business, although not immediately, but still had to leave Russia. Thus, in May, the French food industry giant Danone sold its assets in Russia to a company from Tatarstan. Earlier, the French group Adeo, which owns the Leroy Merlin hypermarket chain, planned to transfer its assets to Russian management. In October, the French media wrote that Auchan also started its retreat from Russia, having chosen two potential buyers for stores in the country. At the same time, the company itself did not confirm the information, but also did not deny it.
According to the latest data from Yale University, 23 companies from the Fifth Republic still retained, at least partially, their activities in Russia. Among the rest, for example, are Lactalis, La Redoute, Clarins, Saint-Gobain.
In any case, the indicators of trade turnover between our countries are at the lowest level compared to the situation until 2022. The figures cited by the trade mission of the Russian Federation in France speak for themselves. Thus, from January to August, the trade turnover between the countries amounted to €3.9 billion, which, however, is 2.5% more than in the same period of the previous year. French exports to Russia decreased by 3.6% - falling to €1.3 billion, while imports, on the contrary, increased by almost 6% - to €2.5 billion. The specific weight of Russia in the trade turnover of France is only 0.46% at the end of the first eight months of this year.
For comparison, at the end of 2021, the trade turnover between France and Russia amounted to €16.1 billion, of which €6.4 billion were exports to Russia and €9.6 billion were imports from it. Moreover, compared to the indicators of 2020, the trade turnover then increased by 48%. The situation began to change with the start of the ETS and the intensification of Western sanctions pressure on Russia. As a result, by the end of 2023, the trade turnover between France and Russia already amounted to €5.6 billion.
European companies in Russia
It is important to note that despite the sanctions and the decline in trade turnover, Russia maintains trade relations with many European countries. Thus, in mid-October, the German embassy in Russia confirmed to Izvestia that about 1.2 thousand companies with German capital were operating in Russia at that time. It should be reminded that Germany remains Russia's largest trade and economic partner in the European Union. At the end of 2023, trade turnover between the countries amounted to over €11.7 billion. Among the most active partners of Russia in the EU last year were also the Netherlands (€9.9 billion) and Italy (€9.4 billion). Among the EU countries, Russia's trade turnover of more than $5 billion was recorded with Hungary, Belgium, Poland and Austria.
If we talk about Italian business in Russia, then in May 2024 the Minister of Foreign Affairs and Deputy Prime Minister of the Republic Antonio Tajani said that about 200 companies continued to work in Russia. Moreover, in December, the same Tajani held a meeting to discuss ways to protect the interests of Italian business in Russia under sanctions.
As for France, according to media reports, President Emmanuel Macron met with representatives of big business throughout 2022 and assured them that the state would be neutral towards those corporations that would remain in Russia. But in the following years, the situation has changed, Alexei Chikhachev, a senior lecturer at the Department of European Studies at St. Petersburg State University and an expert at RIAC and the Valdai Club, explained to Izvestia.
- As the conflict in Ukraine develops, the French leadership has taken an increasingly unfriendly stance toward Russia. And if during 2022 we could say that it was taking a more or less cautious line, now we see that Macron is putting forward initiatives related to sending troops to Ukraine," he recalled.
Therefore, if earlier there were attempts to directly or indirectly support the business remaining in Russia, they have come to naught under the influence of the political factor. At the same time, of course, there is a certain demand for pragmatic cooperation within the business community. Some political figures continue to say that it was necessary to build positive and pragmatic relations with Russia, not to cut ties. But such people in France are now in the minority, and basically the entire political class takes an anti-Russian position, the expert said.
By the way, on December 23, Macron finally approved the composition of the new government of Francois Bayrou, which replaced the cabinet of Michel Barnier, who resigned after a vote of no confidence. Tellingly, Foreign Minister Jean-Noël Barrot and Defense Minister Sébastien Lecornu retained their seats in the new government. This suggests that the country's foreign policy and, in particular, Paris's position on the Ukrainian conflict are unlikely to change.
What France exports to Russia
Due to the sanctions, everything related to aviation and space industry has disappeared from the list of goods exported by France to Russia. In 2021, the export of these products to Russia brought the republic €1.7 billion. Today France mainly supplies us with pharmaceuticals (€303.3 million), perfumes and toiletries (€160.2 million), cereals (except rice), pulses and oilseeds (€119.3 million).
After the European ban on Russian oil purchases, LNG is the first place in French imports from Russia. Between January and August, France purchased €1.9 billion worth of it, with the republic receiving more Russian LNG for the first time in 2024 than in any full year since deliveries began in 2018, according to Bloomberg data as of November. France also imported €181 million worth of fertilizers and nitrogen compounds, non-ferrous metals (€121.8 million) and aluminum (€110.3 million) from Russia.
The topic of liquefied gas is worth mentioning separately. As Ursula von der Leyen, head of the European Commission, said in late November, the EU intends to "expel Russian natural gas from the European market" and actively invest in green energy to reduce prices for industry and European consumers. Specifically, under the RePowerEU program, the bloc's countries are required to phase out Russian LNG by 2027.
As a supranational body, Brussels is in favor of a principled break with Russia. In this sense, European officials do not care at all what happens in national economies, says Igor Yushkov, leading analyst of the National Energy Security Fund, expert and lecturer at the Financial University under the Government of the Russian Federation.
- What is happening in Germany and Italy, for example, is not their sphere of responsibility. They may claim that they will be better off without Russian gas and that American gas will be cheaper. But the fact is that if it were cheaper, only American gas would be bought. If giving up Russian gas would lead to lower prices, as von der Leyen said again, then, of course, everyone would have given it up long ago," he added. - No one there will take our gas at high prices out of pure love for Russia. It is precisely because of the low prices that they buy it, despite political disagreements with Russia.
Meanwhile, it is possible that at the beginning of 2025, when the EU presidency passes from Hungary to Poland, the EU member states will agree on the 16th list of anti-Russian measures. It may again include restrictions against our LNG. Recall that the 14th package included a ban on the transit of Russian liquefied natural gas through European ports, as well as on its import through EU terminals not connected to the natural gas system.
A complete rejection of Russian energy resources will only raise gas prices, increase costs for French enterprises and deal a serious blow to their profitability and competitiveness, according to the Russian embassy.
- This is an obvious evidence of the fact that the course taken by official Paris to curtail cooperation with Russia is completely contrary to the interests of the French economy and, therefore, of the French people," they added.
The diplomatic mission emphasizes that it is too early to make forecasts for 2025. "Russia does not refuse to supply its gas. There will be a solvent demand - there will be a supply. The question is again in the ability of the French authorities to pursue a sovereign policy," the diplomats summarized.
