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    Aug 08, 2014

    Russia may ban EU, US airlines' overflights


    RUSSIA could block overflights between Europe and Asia in retaliation for Western sanctions, Prime Minister Dmitry Medvedev warned yesterday, even as he announced a "full embargo" on food imports from Western countries.

    "First is a ban on using the airspace of our country for transit flights by European and United States airlines in the Asia-Pacific region," said Mr Medvedev.

    "Of course this is a severe measure. Nevertheless, we need to mention it," he added.

    The ban could hurt European airlines such as Lufthansa, British Airways, Air France and Finnair, which operate many long-haul routes to Asia.

    Aeroflot's low-cost subsidiary Dobrolet, which flew to Crimea, annexed by Russia in March, said at the weekend it was forced to ground all of its flights because of EU sanctions hitting its leases for Boeing aircraft.

    Mr Medvedev repeated the threat as he ordered bans on major food products from the European Union and the US in response to their sanctions over Russian policy in Ukraine.

    "Russia is introducing a full embargo on imports of beef, pork, fruit and vegetable produce, poultry, fish, cheese, milk and dairy products from the European Union, the US, Australia, Canada and Norway," he told a government meeting in televised remarks.

    The ban will not cover baby food, he said, and people will still be able to buy the banned products abroad if they want, but warned those who try to profit from reselling them will be "harshly punished".

    While the food ban will harm countries supplying food to Russia, "it will likely only amplify the effects of financial and sectoral sanctions imposed on Russia", Dmitry Polevoy, an economist at ING Bank in Moscow, said. "This will likely add to overall sanction costs via higher food inflation and so will have a widespread effect on households."