Moldova's Finance Ministry estimates that the ban on Moldovan wine imports that Russia imposed in March 2006 has cost the country 400 million lei ($30.3 million).

A ministry official told Interfax that, since the state budget for 2006 was revised upward twice and its increase amounted to more than 1 billion lei ($75.8 million), the lost revenue from the suspension of wine exports to the Russian market turned out to be not so noticeable for the budget.

However, he said the ban has had an indirect impact on Moldova's economy, shutting down a number of businesses, depressing wages for workers, who have been sent on forced leave, and reducing tax payments.

Economics and Trade Minister Igor Dodon said that, due to the Russian ban, Moldova would see its first drop in exports since 2001.
Preliminary figures show exports will be down 5% this year compared to 2005, he said.

The import ban will have a negative impact on industrial production, which will fall 6%-7% in 2006. Production of cardboard and glass products has also fallen, Dodon said.

However, Dodon said there have been positive trends in the winemaking sector. Winemakers have managed since spring to establish exports to countries that had not imported Moldovan wine until now. We are now exporting products to more than 40 countries, including the United States, Japan and China, he said.

He said the Russian ban was a good lesson for businesses. It will not be possible to quickly restore the volume of wine exports to Russia to the previous levels, he added.

A source at Moldova-Vin said exports of wine products to the European Union jumped 32% year-on-year to $8.7 million in the first ten months of 2006. Exports were up 61% to $2.8 million to Poland, 29% to $1.3 million to Germany, 8% to $1.1 million to Latvia, 25% to $1.1 million to the Czech Republic and 11% to $0.7 million to Estonia.

Exports of Moldovan wine and brandy to countries outside the EU soared 810% to $20.1 million, including $16.9 million to Romania, $1.2 million to Bulgaria, $0.8 million to the United States and $0.5 million to Israel.
Exports of wine products to the CIS totaled $107.6 million, including $46.9 million to Russia, $26.7 million to Belarus, $24.8 million to Ukraine and $7.2 million to Kazakhstan.

Moldovan producers shipped a total of $136.4 million worth of wine products in the ten months, nearly 50% less than a year earlier.