MOSCOW, July 16About a day remains before the completion of the so-called grain deal: whether it will be extended or suspended will become known in the near future. Who benefits from the extension of the deal, and who will be harmed by such a development, gathered the opinions of experts from different countries.
Who benefits
Earlier, US Secretary of State Anthony Blinken announced his interest in extending the grain deal. He noted that the rejection of the agreements would pose a threat to developing countries.
At the same time, according to the UN, only 2.5 percent of food from Ukraine went to low-income countries, and another 17 percent went to lower-middle-income countries.
In support of the extension of the deal, UN Secretary-General António Guterres sent a letter to Russian President Vladimir Putin with a proposal aimed at extending the Black Sea Initiative. In turn, Putin reported that he had not yet seen the letter.
The head of the European Commission, Ursula von der Leyen, also called for the extension of the deal. She said that the EU is facilitating the negotiations between Turkey and the UN.
In addition, the Secretary General of the Cooperation Council for the Arab States of the Gulf, Jassim Al-Budaiwi, declared his interest in the work of the deal. And the director of the statistical department of the Food and Agriculture Organization of the United Nations, Jose Rosero Moncayo, expressed the opinion that the Black Sea Grain Initiative brought stability to the markets, helped to reduce prices, especially for grains — wheat and maize, from the peak values that were observed in May 2022. A similar opinion is shared by the representative of the World Food Program Allison Oman Lavie. According to her, world food prices have stabilized, albeit at the highest level in ten years.
At the same time, Putin pointed out in early September last year that the West was exporting most Ukrainian grain to its own states, and not to needy countries in Africa. He stated that Moscow was ready to supply the poorest countries free of charge with the entire volume of grain that was intended for them under the grain deal.
Supporting relations with Turkey
Andrey Suzdaltsev, Associate Professor at the Faculty of World Economy and International Affairs at the National Research University Higher School of Economics, said earlier that the extension of the deal is unprofitable for Russia, but such a step may indirectly indicate good relations with Turkey.
«If you look narrowly at the grain deal, then its extension is, in fact, our help to the enemy. After all, the deal is beneficial to Kiev and European speculators who sell Ukrainian grain not to Africa, but to Europe», — he said.
Influence on Ukraine
When the deal is completed, Ukraine and its farmers will be the main victims, Leonid Khazanov, an independent expert in the field of industry and energy, said earlier.
«Farmers in Ukraine will have a hard time, because then the opportunities for the export of their grain will be reduced,» he said.
On the other hand, the expert noted, a drop in income could push the Ukrainian authorities to negotiate with Russia.
Influence on other countries
According to the director of the Center for Research and Implementation of Security and Defense Strategies (GÜVSAM), professor at the Istanbul University of Istinye Fakhri Erenel, among the importing countries, Turkey and China, which are one of the main buyers of Ukrainian grain, will mainly suffer. “So they can feel the damage from this situation,” he said.
Mei Xinyu, a researcher at the Academy of International Trade and Economic Cooperation of the Ministry of Commerce of the People's Republic of China, disagrees with him. He believes that the completion of the grain deal will not play a special role for the Chinese market, but may have a more noticeable impact on other developing countries, especially in the Middle East.
«If we look at how the Black Sea deal was executed throughout the year, we can see that the agricultural products and grain that Ukraine exported were mostly delivered to European countries, and not elsewhere. This had an impact on China and other developing countries. So whether the deal is extended or not, there will not be much direct impact on China,» he said.
Iraqi expert in the field of agriculture Khattab al-Damin agrees with his Chinese counterpart and also sees a threat from the completion of the grain deal for the countries of the Middle East.
“There is no doubt that the non-renewal of the grain marketing agreement will lead to higher prices for wheat on international markets, as it has been in recent years, as the supply of wheat will decrease along with the volume of products exported from Ukraine. This will negatively affect the balance between supply and demand with current prices and will affect a group of countries in the Middle East that are dependent on wheat imports to meet their local needs — in particular, Egypt, Iraq and Saudi Arabia,» the expert said.
According to him, Iraq alone needs to import at least 2.5 million tons.
Neighboring Iran is close to full self-sufficiency in wheat production, said Zabihollah Azami Sardui, a member of the Iranian parliament (Majlis of the Islamic Council). According to him, if the country needs to buy grain, they will turn to Russia and other EAEU countries.
Canceling the grain deal would jeopardize Lebanon's food security, Nasser Surur, head of the Beirut and Mount Lebanon Bakers' Union, said earlier. «The non-renewal of the grain deal will have a negative impact on Lebanon, especially given that wheat stocks will last for approximately 75 days,» he commented on the situation.
At the same time, European agrarians will primarily suffer from the extension of the grain deal, since European countries have already faced an influx of cheap Ukrainian grain and have suffered significant financial losses because of this, said Leonid Khazanov, an independent expert in the field of industry and energy.
«Accordingly, if the deal is terminated, grain prices in the EU market may go up, increasing the profitability of its agriculture,» Khazanov notes.
Andrey Suzdaltsev, Associate Professor at the Faculty of World Economy and International Affairs at the National Research University Higher School of Economics, has a different opinion. According to him, the deal is beneficial for Kyiv and European speculators who sell Ukrainian grain not to Africa, but to Europe.
About the Black Sea Initiative
The Black Sea Initiative, which was signed on July 22, 2022 by representatives of Russia, Turkey, Ukraine and the UN, involves the export of Ukrainian grain and food, as well as fertilizers across the Black Sea from three ports, including Odessa. The coordination of vessel traffic is handled by the Joint Coordination Center in Istanbul. Putin pointed out that the West exports most of the Ukrainian grain to their own states, and not to the needy African countries.
The grain initiative is an integral part of the package agreement. The second part, the Russia-UN memorandum, designed for three years, provides for the unblocking of Russian exports of food and fertilizers, and among the main tasks were the reconnection of the Russian Agricultural Bank to SWIFT, the resumption of supplies of agricultural machinery, spare parts and services, the restoration of the Togliatti-Odessa ammonia pipeline and a number of other measures. As noted in Moscow, this part of the package agreement has not yet been implemented.