Friday, February 16, 2024

Latvia Is Russia's Whiskey Mule


Russia has its own whiskey, but they want ours.

Despite sanctions intended to deprive Russia and Russians of any Western goods they may want, many things are getting through, including scotch and bourbon. The mule satisfying Russia's whiskey jones is our NATO ally, Latvia.

According to DW, the German public broadcaster, in the first nine months of last year, Russia imported almost €244 million ($266 million) worth of whiskey products. Three-fourths of that came through Latvia, according to figures published by the Russian news agency RIA Novosti. In second place was another Baltic country, Lithuania, which sold Russia €27 million worth of whiskey.

Latvia also has become Russia's largest source of wine.

According to the Latvian government's official statistics portal, its exports to Russia were worth more than €1.1 billion last year. More than half of that was for alcohol and vinegar.

Latvia and Lithuania have small, domestic beverage alcohol industries, but most of what they ship to Russia comes from Western companies registered in the Baltics. 

What about sanctions? The head of a Russian spirits importer says it merely required a paperwork change. "While documents used to say that imports to Russia simply went through Latvia or Lithuania, now the Baltic states appear as the destination of the export, " he told the news agency. "Deliveries to Russia are then made from there."

Some observers say selling whiskey to Russia does not technically violate sanctions. Routing shipments through the Baltics, with Baltic companies handling all the of re-shipment to Russia, is mostly about Western companies concealing their Russian business to protect their reputations. 

According to the London-based Moral Rating Agency, Pernod Ricard is one of the largest suppliers of alcoholic beverages to Russia. Pernod owns Chivas Regal, Ballantine's, Royal Salute, The Glenlivet, Aberlour, Jameson, Powers, TX Whiskey, Rabbit Hole, Smooth Ambler, and Jefferson's. Pernod says it is trying to get out but, as just about everyone involved in this bemoans, it's complicated.

Latvia was admitted to NATO in 1999, along with Bulgaria, Estonia, Lithuania, Romania, Slovakia, and Slovenia, all states formerly dominated by Russia. They and other former Russian satellites, such as Poland, tend to be the most enthusiastic supporters of Ukraine, but many, such as Latvia, also have large Russian-speaking populations and many business and cultural connections to Russian entities. It's ironic, but also complicated. 

1 comment:

Richard Turner said...

Well, ideology and geopolitics aside, profit motive still holds sway in most cases. I'm sure nobody is selling at discounts to keep Russians in alcoholic beverages.