The defence secretary has said the government will take a “very close look” after Sky News found UK exports are almost certainly helping Russia’s war effort in Ukraine.
Drone equipment and heavy machinery are among items being sent to countries including Kyrgyzstan, Armenia and Uzbekistan, from where they are understood to be forwarded to Russia.
Sky’s economics and data editor Ed Conway said it was undermining the official UK sanctions regime and bolstering Vladimir Putin’s war machine.
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Mr Shapps says the government will investigate the apparent circumventing of sanctions
Defence Secretary Grant Shapps told the House of Commons on Thursday: “I did read at length Ed Conway’s excellent thread talking about this issue.
“It is the case that when you set up sanctions initially they tend to work, but they’ll eventually work their way and find another route to market.
“As Ed Conway points out in the thread this is an international problem… I can assure him that the British government will be taking a very close look.”
Officially, flows of heavy machinery, electrical equipment and cars from the UK to Russia have dropped to nearly zero – with the government calling it “the most severe package of economic sanctions ever imposed”.
However, Sky News analysis of Britain’s official trade statistics gives a different perspective.
It shows that while UK firms’ exports to Russia have fallen sharply, exports to various former Soviet satellite states have risen at an unprecedented rate.
Among items being exported are significant quantities of “dual use” items that can be repurposed into weaponry.
Exports to four countries have risen by over 500% since the outbreak of war and, worryingly, by far the biggest class of goods being sent are “parts of aeroplanes, helicopters or unmanned aircraft”.
UK exports of sanctioned items
Main UK items exported
British exports to Kyrgyzstan, the small former Soviet satellite state, are up more than 1,100%, for example.
These exports are dominated by heavy machinery and vehicles which can no longer be sent directly to Russia.
They are also up nearly as sharply to Armenia, which according to Robin Brooks – former chief economist of financial body the IIF, has recorded a sharp increase in its onward exports to Russia.
UK goods exports to Armenia
Mr Brooks said it’s been going on for some time and that other European countries, notably Germany and Poland, also send large quantities of hardware to Russia via these states.
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He told Sky News that firms were “clearly getting an order from somewhere that is a Russian satellite that happens to be domiciled in one of these Central Asian countries”.
He said the rise in exports was “completely insane” and that Russia was “the only reasonable explanation”.
Prior to Mr Shapps’s comments, the government told Sky News they are constantly attempting to tighten the sanctions regime.
“Any non-compliance with these tough sanctions is a serious offence and punishable through large financial penalties or criminal prosecution,” said a spokesman.
Foreign Secretary Lord Cameron added 50 more people and businesses to the UK sanctions list on Thursday.
Some 2,000 individuals and companies have been sanctioned since the start of the war two years ago, according to the Foreign Office.
The latest measures target companies linked to the manufacture of munitions, Russian importers and manufacturers of machine tools, and oil and diamond traders.
