Belgian companies brace for tough times as sanctions begin to bite

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By Pedro Sacadura
Belgian companies brace for tough times as sanctions begin to bite
Copyright  Wikicommons

EU sanctions against Russia are already starting to hit businesses in Belgium.

Companies like Wallonia's historical Lefebvre brewery are now facing plummeting exports, payment disruptions and raw material supply issues.

There's additional pressure too as energy prices continue going through the roof as the war unfolds in Ukraine.

"Seventy per cent of the brewery's production is exported, and overall, Ukraine, Belarus and Russia represent around 20 to 22% of total exports," Paul Lefebvre, CEO of the Lefebvre Brewery told Euronews. "We're already feeling the effects of the crisis quite hard. At the moment exports are quite difficult - almost impossible in fact - because trucks face trouble crossing the borders and regarding payments, we aren't sure clients will still be able to pay us."

But the conflict between Russia and Ukraine is not only rocking the Belgian brewery sector.

In Antwerp, known as the world's most important diamond trading hub, things are also looking precarious and businesses with strong trading ties with Russia are bracing for tough times ahead.

For now, the diamond trade has escaped direct sanctions, but businesses here relying on Russian suppliers may suffer more through collateral damage according to Tom Neys, a spokesperson for the Antwerp World Diamond Centre.

"We started to feel the impact certainly after the EU decided to cut some banks off from the SWIFT system," Neys said. "Even yesterday, they added six new banks. So, it's going quite fast these last few days and that, of course, has an impact on international payments. But besides that, [there is] also the European airspace that got cut off."

Jan De Brabanter, from the Brussels Chamber of Commerce, told Euronews that, for now, Belgian companies are adopting a wait and see approach.

But some of the country's key sectors will likely feel the burden and need to do something.

"There are some sectors doing business with both parties in Russia and in Ukraine, of course. Technology, food products [and] beverages," De Brabanter said.

Struggling with record inflation levels, Belgium can only expect more havoc, with the country's prime minister praising the EU's response to the war.

However, he's now urging the European Commission to put forward a package of measures to cushion the impact of the sanctions.