Luxembourg trades more with Russia than most EU countries. For this reason, numerous economic operators are feeling the repercussions of the war in Ukraine and the sanctions against Russia. This was noted on Thursday at the meeting of the Parliamentary Committee for Economic Affairs.
In addition, certain Luxembourgish products can no longer be exported to Russia. These are dual-use products, which can be used for military purposes. In fact, Minister of the Economy Franz Fayot has banned their export and stressed that the ban is subject to “strict controls”.
The Christian Social People’s Party (CSV) is sceptical regarding how “strict” these controls actually are. MP Laurent Mosar stated that his party also has doubts regarding Luxembourg’s implementation of sanctions in general. To this end, the CSV also intends to enquire with Minister of Finance Yuriko Backes, who is in charge of customs, how sanctions are implemented in practice.
Before the war, 5.7% of Luxembourg’s exports went to Russia. Nowadays, these activities are of course severely restricted for many reasons.
There are a number of Russian companies with which Luxembourg “can no longer cooperate,” Fayot explained, as these companies are all on the sanctions list. In this case, the Minister said, it is up to the Luxembourgish companies themselves “to carry out due diligence, i.e. to check, and in this case to stop working with them”.
The plastic casing producer Accumalux, for example, has a location in Russia. Kronospan, Guardian, and Paul Wurth are other players with important links to Russia. Luxembourgish companies are also present in Ukraine, such as Arcelor Mittal, which has a fully integrated factory near the Donbass region. “It is of course shut down at the moment,” Fayot stated.
So far, however, none of the Luxembourgish companies struggle financially due to the current situation.
Another issue on the Committee’s agenda was ships. The Minister of the Economy explained that he is responsible for “yachts or ships of Russian oligarchs or nationals, which are on the sanctions list”.
None of these ships are currently on the register. Recreational boats, meanwhile, can only be owned by Luxembourg residents. Fayot also assured that no person whose name appears on the sanctions list receives financial aid from the Ministry of the Economy.
