Russia is worried about expansion of EU

Russia is worried about expansion of EU

According to the recent news in the market, negotiations between Russia and EU on quota problem regarding steel exports are not finalized yet. There has been an ongoing problem between Russia and EU regarding the volume of quota that will be allocated for steel exports of Russia after the expansion of EU in May, 2004. As previously reported by SteelOrbis, under the scope of the agreement signed in July 2002, the quota allocated to Russia was 1.3 million tons for 2004. However, Russia requested from EU to expand this quota by 450'000-500'000 tons as the amount is closer to the export volume of Russia to the ten countries joining EU in May. Russia's demand stems from its concern that after certain Eastern European countries join EU, exports of Russia to these countries will be included to the EU quota allocated to Russia, thus leading reduction in the exports of Russia. According to the statement made by an EU official, the additional quota for Russia this year will include exports from Severstal and Mechel, totaling 161'000 tons. However, it is reported that no settlement has been made about the exact volume of Russia's export to EU after its expansion. The other reason of Russian steel makers' concern about expansion of EU is that, Russian government policy may change remarkably.