Europe feels sting in the tail of Russia sanctions

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Europe feels sting in the tail of Russia sanctions
People buy imported fruit at a supermarket in downtown Moscow on Thursday, Aug. 7, 2014. The Russian government has banned all imports of meat, fish, milk and milk products and fruit and vegetables from the United States, the European Union, Australia, Canada and Norway, Prime Minister Dmitry Medvedev announced Thursday. The move was taken on orders from President Vladimir Putin in response to sanctions imposed on Russia by the West over the crisis in Ukraine. The ban has been introduced for one year. (AP Photo/Ivan Sekretarev)
SAINT PETERSBURG - SEPTEMBER 04: In this handout image provided by Ria Novosti, Dean of the Department of Liberal Arts and Sciences, Saint Petersburg State University Alexei Kudrin attends the briefing 'The issues of development of global and Russian economy on the G20 agenda.' ahead of the G20 summit on September 4, 2013 in St. Petersburg, Russia. The G20 summit is scheduled to run between September 5th and 6th. (Photo by Roman Yandolin/RIA Novosti via Getty Images)
Russia's former finance minister Alexei Kudrin, left, speaks during a news conference in Moscow, Russia, Thursday, April 5, 2012. Russia's former finance minister says he has set up an independent committee to shape policies alternative to those of the government. Kudrin resigned last year over a disagreement with then President Dmitry Medvedev, and threw his support behind the emerging opposition movement. (AP Photo/Ivan Sekretarev)
Russian President Vladimir Putin listens to the Audit Chamber chairwoman Tatyana Golikova, foreground, at the Novo-Ogaryovo residence, outside Moscow, Russia, Tuesday, Sept. 16, 2014. (AP Photo/RIA Novosti Kremlin, Mikhail Klimentyev, Presidential Press Service)
Women choose Dutch tomatoes at a supermarket in downtown Moscow, on Thursday, Aug. 7, 2014. The Russian government has banned all imports of meat, fish, milk and milk products and fruit and vegetables from the United States, the European Union, Australia, Canada and Norway, Prime Minister Dmitry Medvedev announced Thursday. The move was taken on orders from President Vladimir Putin in response to sanctions imposed on Russia by the West over the crisis in Ukraine. The ban has been introduced for one year. (AP Photo/Ivan Sekretarev)
President Barack Obama speaks on the South Lawn of the White House in Washington, Tuesday, July 29, 2014, as he announces new economic sanctions against key sectors of the Russian economy in the latest move by the U.S. to force Russian President Vladimir Putin to end his support for Ukrainian rebels.
People hold on August 30, 2014 leaflets, reading 'Stop Putin' and 'Ukraine: 22 years without the war. Russia: 1.1992-Transnistria. 2.1994-1996-Chechnya. 3. 1999-2009-Chechnya. 4 2008-South Ossetia and Abkhazia. 5.2014-Ukraine' during a rally against Russian President Vladimir Putin as the European Union readied a fresh wave of sanctions against Russia at a summit in Brussels, with warnings that the escalating conflict in Ukraine was putting all of Europe at risk. AFP PHOTO/ ALEXEY KRAVTSOV (Photo credit should read ALEXEY KRAVTSOV/AFP/Getty Images)
President Barack Obama speaks on the South Lawn of the White House in Washington, Tuesday, July 29, 2014, as he announces new economic sanctions against key sectors of the Russian economy in the latest move to force Russian President Vladimir Putin to end his support for Ukrainian rebels. (AP Photo/Manuel Balce Ceneta)
President Barack Obama walks on the South Lawn of the White House in Washington, Tuesday, July 29, 2014, to announce new economic sanctions against key sectors of the Russian economy in the latest move to force Russian President Vladimir Putin to end his support for Ukrainian rebels. (AP Photo/J. David Ake)
President Barack Obama speaks on the South Lawn of the White House in Washington, Tuesday, July 29, 2014, as he announces new economic sanctions against key sectors of the Russian economy in the latest move to force Russian President Vladimir Putin to end his support for Ukrainian rebels. (AP Photo/Manuel Balce Ceneta)
President Barack Obama speaks on the South Lawn of the White House in Washington, Tuesday, July 29, 2014, as he announces new economic sanctions against key sectors of the Russian economy in the latest move to force Russian President Vladimir Putin to end his support for Ukrainian rebels. (AP Photo/J. David Ake)
President Barack Obama speaks on the South Lawn of the White House in Washington, Tuesday, July 29, 2014, as he announces new economic sanctions against key sectors of the Russian economy in the latest move to force Russian President Vladimir Putin to end his support for Ukrainian rebels. (AP Photo/Manuel Balce Ceneta)
Russian President Vladimir Putin speaks during a plenary session of the St. Petersburg International Investment Forum Friday, May 23, 2014. Putin said Friday at an investment forum that Russia will "respect the choice of the Ukrainian people." He said that Russia wants peace and order to be restored in Ukraine. (AP Photo/RIA Novosti Kremlin, Mikhail Klimentyev, Presidential Press Service)
Russian President Vladimir Putin listens during the St.Petersburg International Investment Forum in St Petersburg, Russia, Friday, May 23, 2014. Speaking at the investment forum, Putin blamed the West for encouraging a “coup” in Ukraine, when the nation’s pro-Russian president was chased from power after months of protests. He said that Ukraine is now facing “chaos and a full-scale civil war.” (AP Photo/RIA Novosti Kremlin, Mikhail Klimentyev, Presidential Press Service)
Russia's President Vladimir Putin attends an economic forum in Saint Petersburg, on May 23, 2014. Putin said today that the crisis in Ukraine had evolved into a full-scale civil war, blaming Washington for backing the overthrow of former president Viktor Yanukovych. AFP PHOTO/ RIA-NOVOSTI/ POOL / MIKHAIL KLIMENTYEV (Photo credit should read MIKHAIL KLIMENTYEV/AFP/Getty Images)
Russia's President Vladimir Putin attends an economic forum in Saint Petersburg, on May 23, 2014. Putin said today that the crisis in Ukraine had evolved into a full-scale civil war, blaming Washington for backing the overthrow of former president Viktor Yanukovych. AFP PHOTO/ RIA-NOVOSTI/ POOL / MIKHAIL KLIMENTYEV (Photo credit should read MIKHAIL KLIMENTYEV/AFP/Getty Images)
Vladimir Putin, Russia's president, pauses during a global business leaders summit at the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia, on Friday, May 23, 2014. SPIEF is an annual international conference dedicated to economic and business issues which takes place at the Lenexpo exhibition center May 22-24. Photographer: Andrey Rudakov/Bloomberg via Getty Images
Russian President Vladimir Putin attends a media meeting organized by the Russian People's Front in St. Petersburg, Russia, Thursday, April 24, 2014. Russia’s President Vladimir Putin has mocked the Internet as a CIA project and pledged to protect Russia’s interest in the online industry. (AP Photo/RIA-Novosti, Mikhail Klimentyev, Presidential Press Service)
Russian President Vladimir Putin takes part in a meeting of Russia's People's Front in St.Petersburg, Russia, Thursday, April 24, 2014. Ukrainian government troops moved against pro-Russia forces in the east of the country on Thursday and killed at least two of them in clashes at checkpoints manned by the insurgents, the government and insurgents said. Russian President Vladimir Putin decried what he described as a "punitive operation." (AP Photo/RIA Novosti Kremlin, Mikhail Klimentyev, Presidential Press Service)
Russian President Vladimir Putin meets with Royal Dutch Shell's CEO Ben Van Beurden in the Novo-Ogaryovo residence outside Moscow, Russia, Friday, April 18, 2014. (AP Photo/Maxim Shipenkov, Pool)
Russian President Vladimir Putin chairs a Security Council meeting in the Novo-Ogaryovo residence outside Moscow, Russia, Friday, April 18, 2014. (AP Photo/RIA-Novosti, Alexei Druzhinin, Presidential Press Service)
CAPTION CORRECTS THE EVENT Russian President Vladimir Putin enters a hall for a video call with the Prirazlomnaya arctic oil platform marking the launch of production in the Novo-Ogaryovo residence outside Moscow, Russia, Friday, April 18, 2014. (AP Photo/Maxim Shipenkov, Pool)
Russian President Vladimir Putin, flanked by Defense Minister Sergei Shoigu, left, and Federal Security Service Chief Alexander Bortnikov, right, arrives on a boat after inspecting battleships during a navy parade marking the Victory Day in Sevastopol, Crimea, Friday, May 9, 2014. Putin extolled the return of Crimea to Russia before tens of thousands Friday during his first trip to Black Sea peninsula since its annexation. The triumphant visit was quickly condemned by Ukraine and NATO. (AP Photo/Ivan Sekretarev)
Russian President Vladimir Putin speaks during a Victory Day Parade, which commemorates the 1945 defeat of Nazi Germany, in Red Square, with St. Basil Cathedral in the background, in Moscow, Russia, Friday, May 9, 2014. Putin made no reference to the situation in Ukraine when he opened Friday's parade, focusing on the historic importance of the victory over Nazi Germany. (AP Photo/Pavel Golovkin)
Russian President Vladimir Putin, right, and Prime Minister Dmitry Medvedev, wearing ribbons symbolizing the Soviet victory in WWII, arrive to attend the Victory Day Parade, which commemorates the 1945 defeat of Nazi Germany, in Moscow, Russia, Friday, May 9, 2014. Russia marks the Victory Day on May 9 holding a military parade in Red Square in Moscow. (AP Photo/Pavel Golovkin)
Russian President Vladimir Putin heads to speak at a parade marking the Victory Day in Sevastopol, Crimea, Friday, May 9, 2014. Putin extolled the return of Crimea to Russia before tens of thousands Friday during his first trip to Black Sea peninsula since its annexation. The triumphant visit was quickly condemned by Ukraine and NATO. (AP Photo/Ivan Sekretarev)
Russian President Vladimir Putin speaks at a navy parade marking the Victory Day in Sevastopol, Crimea, Friday, May 9, 2014. Putin extolled the return of Crimea to Russia before tens of thousands Friday during his first trip to Black Sea peninsula since its annexation. The triumphant visit was quickly condemned by Ukraine and NATO. (AP Photo/Ivan Sekretarev)
Russian President Vladimir Putin heads to speak at a navy parade marking the Victory Day in Sevastopol, Crimea, Friday, May 9, 2014. Putin extolled the return of Crimea to Russia before tens of thousands Friday during his first trip to Black Sea peninsula since its annexation. The triumphant visit was quickly condemned by Ukraine and NATO. (AP Photo/Ivan Sekretarev)
Russian President Vladimir Putin arrives on a boat after inspecting battleships during a navy parade marking the Victory Day in Sevastopol, Crimea, Friday, May 9, 2014. Russian President Vladimir Putin extolled the return of Crimea to Russia before tens of thousands Friday during his first trip to Black Sea peninsula since its annexation. The triumphant visit was quickly condemned by Ukraine and NATO. (AP Photo/Ivan Sekretarev)
Russian President Vladimir Putin speaks at a navy parade marking the Victory Day in Sevastopol, Crimea, Friday, May 9, 2014. Crimea, which hosts a major Russian Black Sea Fleet base, is set to hold a massive navy parade in the port of Sevastopol. Putin extolled the return of Crimea to Russia before tens of thousands Friday during his first trip to Black Sea peninsula since its annexation. The triumphant visit was quickly condemned by Ukraine and NATO. (AP Photo / Ivan Sekretarev)
Russian President Vladimir Putin, right, and Prime Minister Dmitry Medvedev, wearing ribbons symbolizing the Soviet victory in WWII, arrive to attend the Victory Day Parade, which commemorates the 1945 defeat of Nazi Germany in Moscow, Russia, Friday, May 9, 2014. Thousands of Russian troops march on Red Square in the annual Victory Day parade in a proud display of the nation's military might amid escalating tensions over Ukraine. (AP Photo/Pavel Golovkin)
Russian President Vladimir Putin, right, and Prime Minister Dmitry Medvedev arrive to attend a Victory Day parade, which commemorates the 1945 defeat of Nazi Germany, in Moscow, Russia, Friday, May 9, 2014. Russia marked the Victory Day on May 9 holding a military parade at Red Square in Moscow. (AP Photo/RIA-Novosti, Alexei Nikolsky, Presidential Press Service)
Russian President Vladimir Putin, left, and Prime Minister Dmitry Medvedev attend a Victory Day parade, which commemorates the 1945 defeat of Nazi Germany, at Red Square in Moscow, Russia, Friday, May 9, 2014. Russia marked the Victory Day on May 9 holding a military parade at Red Square. (AP Photo/RIA-Novosti, Mikhail Klimentyev, Presidential Press Service)
Russian President Vladimir Putin, back, speaks at a meeting of the leaders of the member states of the Collective Security Treaty Organization (CSTO) in the Kremlin in Moscow, Russia, Thursday, May 8, 2014. At right is Tajik President Emomali Rakhmon. (AP Photo/Sergei Karpukhin, Pool)
Russian President Vladimir Putin oversees a military exercise involving Russian nuclear forces in Defense Ministry's situation room outside Moscow, Thursday, May 8, 2014. President Vladimir Putin on Thursday oversaw a military exercise involving Russia's nuclear forces amid escalating tensions over Ukraine. Putin said that the maneuvers involved the military across the entire Russian territory, including the nation's nuclear forces. (AP Photo/RIA-Novosti, Alexei Nikolsky, Presidential Press Service)
Russian President Vladimir Putin speaks to Valery Gerasimov, chief of Russian military's General Staff, right, as he attends a military exercise involving Russia’s nuclear forces, at an undisclosed location outside Moscow, Russia, on Thursday, May 8, 2014. Putin, speaking from the Defense Ministry’s headquarters where he oversaw the exercise along with leaders of several ex-Soviet nations which are members of the Collective Security Treaty Organization, said that the maneuvers involved the military across the entire Russian territory, including the nation’s nuclear forces. (AP Photo/RIA Novosti, Alexei Nikolsky, Presidential Press Service)
Russian President Vladimir Putin, centre, attends a meeting of the leaders of the member states of the Collective Security Treaty Organization (CSTO) in the Kremlin in Moscow, Russia, Thursday, May 8, 2014. At right is Tajik President Emomali Rakhmon. (AP Photo/Sergei Karpukhin, Pool)
Russian President Vladimir Putin, right, and Belarusian President Alexander Lukashenko enter a hall for bilateral talks after a meeting of the leaders of the member states of the Collective Security Treaty Organization (CSTO) in the Kremlin in Moscow, Russia, Thursday, May 8, 2014. (AP Photo/Sergei Karpukhin, Pool)
Russian President Vladimir Putin speaks during his visit to the Crimean port of Sevastopol on May 9, 2014. Putin's visit to Crimea, which was annexed by Moscow in March, is a 'flagrant violation' of Ukraine's sovereignty, authorities in Kiev said today.AFP PHOTO/ YURI KADOBNOV (Photo credit should read YURI KADOBNOV/AFP/Getty Images)
Russian President Vladimir Putin speaks during his visit to the Crimean port of Sevastopol on May 9, 2014. Putin's visit to Crimea, which was annexed by Moscow in March, is a 'flagrant violation' of Ukraine's sovereignty, authorities in Kiev said today.AFP PHOTO/ YURI KADOBNOV (Photo credit should read YURI KADOBNOV/AFP/Getty Images)
Ukrainian security forces guard a checkpoint outside the southern city of Mykolayiv on May 9, 2014. Russian President Vladimir Putin took a victory lap in his first visit to Crimea since its annexation by Russia, as fighting in eastern Ukraine left 21 dead just days ahead of a separatist vote. AFP PHOTO/ ALEXEY KRAVTSOV (Photo credit should read ALEXEY KRAVTSOV/AFP/Getty Images)
Ukrainian security forces guard a checkpoint outside the southern city of Mykolayiv on May 9, 2014. Russian President Vladimir Putin took a victory lap in his first visit to Crimea since its annexation by Russia, as fighting in eastern Ukraine left 21 dead just days ahead of a separatist vote. AFP PHOTO/ ALEXEY KRAVTSOV (Photo credit should read ALEXEY KRAVTSOV/AFP/Getty Images)
Ukrainian security forces guard a checkpoint outside the southern city of Mykolayiv on May 9, 2014. Russian President Vladimir Putin took a victory lap in his first visit to Crimea since its annexation by Russia, as fighting in eastern Ukraine left 21 dead just days ahead of a separatist vote. AFP PHOTO/ ALEXEY KRAVTSOV (Photo credit should read ALEXEY KRAVTSOV/AFP/Getty Images)
Armed pro-Russia militiants take part in a rally marking Victory Day in eastern Ukrainian city of Donetsk on May 9, 2014. Russian President Vladimir Putin took a victory lap in his first visit to Crimea since its annexation by Russia, as fighting in eastern Ukraine left 21 dead just days ahead of a separatist vote. AFP PHOTO/ ALEXANDER KHUDOTEPLY (Photo credit should read Alexander KHUDOTEPLY/AFP/Getty Images)
Armed pro-Russia militiants take part in a rally marking Victory Day in eastern Ukrainian city of Donetsk on May 9, 2014. Russian President Vladimir Putin took a victory lap in his first visit to Crimea since its annexation by Russia, as fighting in eastern Ukraine left 21 dead just days ahead of a separatist vote. AFP PHOTO/ ALEXANDER KHUDOTEPLY (Photo credit should read Alexander KHUDOTEPLY/AFP/Getty Images)
Armed pro-Russia militiants take part in a rally marking Victory Day in eastern Ukrainian city of Donetsk on May 9, 2014. Russian President Vladimir Putin took a victory lap in his first visit to Crimea since its annexation by Russia, as fighting in eastern Ukraine left 21 dead just days ahead of a separatist vote. AFP PHOTO/ ALEXANDER KHUDOTEPLY (Photo credit should read Alexander KHUDOTEPLY/AFP/Getty Images)
A man holds pictures of dead relatives during a Victory Day ceremony at the Unknown Sailor Memorial in the southern Ukrainian city of Odessa on May 9, 2014. Russian President Vladimir Putin took a victory lap in his first visit to Crimea since its annexation by Russia, as fighting in eastern Ukraine left at least 21 dead just days ahead of a separatist vote. AFP PHOTO/ ANATOLII STEPANOV (Photo credit should read ANATOLII STEPANOV/AFP/Getty Images)
Russian President Vladimir Putin leaves after a video call with the Prirazlomnaya arctic oil platform marking the launch of production in the Novo-Ogaryovo residence outside Moscow, Russia, Friday, April 18, 2014. (AP Photo/Maxim Shipenkov)
Russian President Vladimir Putin attends a video call with the Prirazlomnaya arctic oil platform marking the launch of production in the Novo-Ogaryovo residence outside Moscow, Russia, Friday, April 18, 2014. (AP Photo/RIA-Novosti, Alexei Druzhinin, Presidential Press Service)
Russian President Vladimir Putin speaks to the media after a nationally televised question-and-answer session in Moscow, Russia, Thursday, April 17, 2014. President Vladimir Putin on Thursday rejected claims that Russian special forces are fomenting unrest in eastern Ukraine, but recognized for the first time that the troops in unmarked uniforms who had overtaken Ukraine's Crimean Peninsula before its annexation by Moscow were Russian soldiers. (AP Photo/Pavel Golovkin)
Russian President Vladimir Putin speaks during a nationally televised question-and-answer session in Moscow on Thursday, April 17, 2014. President Vladimir Putin has urged an end to the blockade of Moldova’s separatist province of Trans-Dniester. Trans-Dniester, located in eastern part of Moldova on border with Ukraine, has run its own affairs without international recognition since a 1992 war. Russian troops are stationed there. (AP Photo/RIA Novosti, Alexei Nikolsky, Presidential Press Service)
Russian President Vladimir Putin, foreground, leaves after a nationally televised question-and-answer session in Moscow, Russia, Thursday, April 17, 2014. At left is Head of Russian Television Channel One Konstantin Ernst. President Vladimir Putin on Thursday rejected claims that Russian special forces are fomenting unrest in eastern Ukraine, but recognized for the first time that the troops in unmarked uniforms who had overtaken Ukraine's Crimean Peninsula before its annexation by Moscow were Russian soldiers. (AP Photo/Pavel Golovkin)
Russian President Vladimir Putin speaks at a nationally televised question-and-answer session in Moscow, Thursday, April 17, 2014. President Vladimir Putin on Thursday rejected claims that Russian special forces are fomenting unrest in eastern Ukraine, but recognized for the first time that the troops in unmarked uniforms who had overtaken Ukraine's Crimean Peninsula before its annexation by Moscow were Russian soldiers. (AP Photo/RIA-Novosti, Alexei Nikolsky, Presidential Press Service)
Russian President Vladimir Putin attends a meeting of a board of trustees of the Russian Geographical Society in a library of Moscow State University in Moscow, Russia, Tuesday, April 15, 2014. (AP Photo/RIA-Novosti, Alexei Druzhinin, Presidential Press Service)
Russian President Vladimir Putin meets with Supreme Court Chairman Vyacheslav Lebedev in the Novo-Ogaryovo residence outside Moscow, Russia, Thursday, April 3, 2014. (AP Photo/RIA-Novosti, Alexei Druzhinin, Presidential Press Service)
Russian President Vladimir Putin, right, shakes hands at the presentation ceremony of the top military brass in the Kremlin in Moscow, Russia, Friday, March 28, 2014. Russia's president says Ukraine could regain some arms and equipment of military units in Crimea that did not switch their loyalty to Russia. (AP Photo/RIA-Novosti, Alexei Druzhinin, Presidential Press Service)
Russian President Vladimir Putin meets with Federation Council members in the Novo-Ogaryovo residence outside Moscow, Thursday, March 27, 2014. (AP Photo/RIA-Novosti, Alexei Nikolsky, Presidential Press Service)
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(Reuters) - At a technology fair in Moscow last month, European executives faced the new reality of doing business in Russia since the West imposed sanctions: the number of companies at the international showcase had shrunk by half from a year ago.

"The impact on business couldn't be clearer. Fewer stands, fewer companies," said Mark Bultinck, a sales executive for Belgian digital screen maker Barco, which had a booth at the annual expo for the audiovisual industry.

The impact of the sanctions was already clear to Barco.

The company lost Russia's biggest shipbuilder as a client when the United States and the European Union blacklisted United Shipbuilding Corporation in July, meaning Barco could no longer sell screens to the company for its vessel training simulators.

Barco's experience shows how sanctions are having a broad impact not just on Russian companies but on European ones too and at a time when Europe's weak economy can ill afford it.

The European Union and the United States imposed economic sanctions on Russia in late July, targeting the Russian energy, banking and defense sectors to punish Moscow's support for rebels in eastern Ukraine, the West's toughest steps yet.

As EU governments consider blacklisting more Ukrainian separatists and potentially more Russians and companies over the crisis in Ukraine, anecdotal evidence and new EU data show the economic costs for Europe of pressuring the Kremlin.

In August, the month after sanctions were imposed, EU exports to Russia fell 19 percent to 7.9 billion euros ($9.91 billion) compared to July, a loss of almost 2 billion euros, according to the EU's statistics office Eurostat.

Although the data is not adjusted for seasonal swings, exports were also down 18 percent compared to August 2013 at a time of year that is traditionally busy for exporters.

The drop partly reflects the food ban Moscow imposed on the European Union in August in response to the West's sanctions. But it goes well beyond that. Total EU exports fell 12 percent in the first eight months of this year compared to a year ago.

In August, EU exports of machinery and transport equipment such as cars and tractors fell 23 percent compared to July. Compared to a year ago, those exports fell 21 percent.

Manufactured exports fell 16 percent across the 28-nation bloc in August. Germany, which accounts for one-third of sales to Russia, saw a sharp drop in sales of those goods, while Italy's manufactured exports tumbled by almost half.

"DUAL USE" LICENSE

The sanctions are having such an impact because EU companies can no longer sell civilian goods that could also have a military use, no matter how small, without a license.

Tractors, cranes, excavators and mechanical parts that are needed to repair cars and trucks all fall under the so-called dual use category and need a permit.

Failure to obtain a license can bring a fine of up to 10 percent of the total value of the exported goods, officials say.

But obtaining such licenses can delay exports by two to three months because so many more products need licenses and customs are suffering a big administrative burden.

"There are delays caused by the increased flow for individual licenses," said Tristan Grimmer, a lawyer at Baker & McKenzie in London, who helps companies navigate the process.

"With the oil and gas sector, much of what is being addressed previously did not require export licenses, so you have an entirely new sector that is asking for license authorizations to supply the Russian market."

LOSING OUT TO CHINA?

One official at the Strategic Goods Control service for Belgium's Flanders region said the number of applications for licenses had jumped by almost 40 percent since August and officials were flooded by emails from companies seeking advice.

"Everyone wants their file to be urgent. But it is not only in our hands. Sometimes we need certification by the Belgian embassy in Russia," said the official, who declined to be named.

In Germany, lawyer Baerbel Sachs at Noerr said that it was difficult to even get customs officials on the phone to discuss progress on a permit because so many people were calling.

Efforts are being made to hire more staff and speed up the process, governments say. Britain's Export Control Organisation says almost all licenses are issued within 60 working days.

But even in that time, companies are at risk of losing contracts to competitors from China and elsewhere, according to Frank Schauff, chief executive office at the Association of European Businesses in Russia.

"Countries that have not imposed sanctions are able to jump in where the EU has left a gap," said Schauff. "The economic position that the European Union has in Russia is at risk and it is very difficult to gain that back if it is lost."

Beijing's envoy to Berlin said in October that China would seize business opportunities in Russia.

At Belgium's Barco, the company says it can still do business in Russia, but only up to a point.

"You know that certain deals are no longer possible," said Carl Vanden Bussche, the company's director of investor relations. "It is a reality that we need to take into account."

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