The impact of sanctions against Russia is beginning to be felt across its logistics sector, as transport options dwindle and payment systems lose support.

A source closely tied to Europe’s forwarding and shippers community said that, while “of course” trade with Russia continued, transport operations and financial aspects of the business were “grinding to a halt”, as efforts to persuade Putin to withdraw from Ukraine ratchet up.

The source told The Loadstar: “Businesses not sanctioned have continued to trade with their European partners, but even here questions are beginning to be asked.

“How do you move goods from Russia with air, rail, road and sea facing substantial capacity reductions? The transport system, specifically to Russia, is getting very complicated, at least from the EU.”

Following discussions with Ukraine president Volodymr Zelensky, US president Joe Biden tweeted that “our sanctions are already having a devastating impact”.

For logistics, the source said, the most acute sanction to hit Russia is the decision of the EU authorities and other nations to close their airspace to Russian flights and shipping lines and logistics operators severing services to the country.

The source said the combination of sanctions and suspensions would amount to “nothing moving” to or from Russia.

Aviation consultancy IBA released figures indicating the scale of the impact, with 589 aircraft operated by Russian carriers but owned by foreign lessors affected.

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The Antonov AN-225 ‘Mriya’ cargo aircraft has been making deliveries around the world for over thirty years. It has come to the aid of several world wide crisis, the latest being integral in carrying medical supplies during the pandemic, from China to Kyiv.

‘Mriya’ which means ‘Hope’ in Ukrainian, the world’s largest aircraft is believed to have been undergoing repair and routine maintenance at Antonov’s airfield premises in Gostomel near Kyiv, when the Russian invasion of Ukraine began.

The fate of the aircraft had been unknown for several days, with mixed reports circulating online as to the extent of the damage. Ukraine’s state-owned aerospace and defence company, Ukroboronprom, initially said in a press release on February 27 that the aircraft had been destroyed, but in a subsequent press release said, “it is impossible to assess the plane’s condition and the possibility and cost of its restoring due the lack of access to the aircraft”. It has also been reported by other experts that it would cost billions to restore the aircraft.

RIP “Mriya” Antonov AN-225, a sad day for the aircraft industry and the world in general! Thank you for your service over the past three decades. You will be remembered with fondness, by thousands of people, who appreciated your presence in their hour of need.

Related article: Kuehne+Nagel charters Antonov to send 111 tonnes of UNICEF goods to Ukraine >

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This week International Trade Secretary, Anne-Marie Trevelyan, signed a new free trade agreement with New Zealand, removing all tariffs on UK exports and cutting red tape for British businesses trading with the country.

This deal is the most advanced agreement that New Zealand has signed with any other nation bar Australia and could boost the UK–New Zealand trade relationship by almost 60%, rising from £2.3 billion in 2020. The deal aims to make it simpler for British SMEs to export goods and services to New Zealand and further supports the UK’s efforts to join the Trans-Pacific Partnership (CPTPP).

Trevelyan said: “Our trade with New Zealand will soar, benefiting businesses and consumers throughout the UK and helping level up the whole country.”

Other UK benefits include:

UK professionals, such as lawyers and auditors, being able to work in New Zealand more easily, and bring their families with them.

Red tape being slashed for the 5,900 UK SMEs who export goods to New Zealand and employ 233,000 people.

Guarantees for small businesses who will benefit from practical advice and support to find opportunities and link to commercial partners in New Zealand.

Flexible rules of origin that will give British exporters an advantage over international rivals in the New Zealand import market, which is expected to grow by 30% by 2030.

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