Themselves with computers – Newspaper Kommersant No. 207 (7408) dated 11/09/2022

Russian electronics manufacturers are asking the government for new support measures, including raising and introducing new duties on imported electronics, mostly at a rate of 5%. This includes smartphones, laptops, servers, storage systems and other equipment. The proposals, according to Kommersant, have already been discussed with the Ministry of Economy, the Ministry of Industry and Trade and the Ministry of Digital Development. Distributors fear that such a measure will lead to an even greater reduction in the assortment in stores and an increase in retail prices.

“Kommersant” got acquainted with the minutes of the meeting at the Ministry of Economy of October 6. It follows from the document that the ministry, with the participation of the Ministry of Industry and Trade, the Federal Customs Service, the Ministry of Digital Transformation, the Aquarius Group of Companies and the Kursk Electrical Apparatus Plant (KEAZ), is discussing the introduction and increase of customs duties on “certain types of radio-electronic products.” Kommersant’s interlocutor, close to the Ministry of Digital Development, clarifies that we are talking about “a wide range of electronics.”

In particular, for computers, laptops, servers, data storage systems, which have not yet been subject to duty, it is proposed to introduce it at a rate of 5%.

After the outbreak of hostilities in Ukraine, the Ministry of Digital Transformation repeatedly discussed with Russian electronics manufacturers and other specialized regulators the issue of increasing customs duties on goods that domestic companies are able to produce or at least assemble from ready-made foreign components, a Kommersant source says. A top manager of a Russian electronics manufacturer also speaks about this: “One of the meetings on the issue was held in mid-October. Several large enterprises came out not only for an increase in import duties, but also for a ban on parallel imports of electronics, analogues of which are assembled in Russia.”

The interlocutor of Kommersant adds that the idea has found support in the Ministry of Digital Development, and the Ministry of Economy “so far looks at it with skepticism.” The fact that the regulators had disagreements, says the federal official who participated in the discussion: “Under the current conditions, the increase in duties is not an optimal measure, it will affect a wide layer of consumers within the country.”

The Ministry of Industry and Trade confirmed to Kommersant that the ministry and other interested departments are considering proposals from Aquarius and KEAZ (a Russian manufacturer of electronics, including controllers, sensors, power supplies, touch panels, etc., 99% owned by Lidia Kanunnikova, by 1% – to Yaroslav Ivanov) on changing import duties. The ministry stressed that this practice exists in various industries to protect and develop domestic producers.

“As a rule, this happens for those positions, the production of which has already been successfully mastered and allows you to increase investment in expanding capacities and mastering technologies,” they noted.

In Mintsifra, KEAZ and the Ministry of Economy did not answer “Kommersant”. The FCS only clarified that the duty rates are set by the unified customs tariff of the Eurasian Economic Union, in the current version, a zero duty is applied to a number of goods from the category “electrical equipment” (see table).

A number of Russian enterprises have really mastered the assembly of consumer electronics. For example, the same “Aquarius” produces laptops, desktop computers and tablets, servers and storage systems. Yadro is a computer manufacturer with plans to expand into the consumer electronics market. Monoblocks, servers, laptops, network equipment are also produced by Kraftway Corporation PLC JSC and a number of other enterprises. In Aquarius, Kommersant emphasizes that the import of finished equipment with zero duties is “a transfer of the profit point beyond the perimeter of Russia.” Therefore, the company confirmed, it proposes to consider the issue of duties in cases where the production of equipment has been mastered in the country.

The introduction of duties is a long and laborious process, since it involves a single decision at the EEC level, taking into account the country’s international obligations as an active WTO member, clarifies a Kommersant source among manufacturers.

“Meanwhile, there are already no less effective support tools, primarily the possibility of reducing the list of parallel imports,” he says.

The duties will lead to “an additional reduction in choice for end users against the backdrop of an already devastated market and the process of parallel imports that has not yet been formed,” Andrey Tarasov, executive director of diHouse (part of the Lanit group), objects, noting the inevitability of price increases. Usually, he explains, the task of raising import duties is to encourage companies to localize production. But, Mr. Tarasov emphasizes, “due to the fact that the world’s largest manufacturers and suppliers of key components refused to work with the Russian Federation, there is simply no one to encourage localization.”

Nikita Korolev