Azernews.Az

By Bloomberg

German machine builders are increasingly feeling the effects of the Russia-Ukraine conflict as exports to the country continue to drop significantly, the VDMA machine- builders lobby said.

Russian companies have difficulties financing purchases from Europe because of a weaker ruble and competition from Chinese suppliers is increasing, the VDMA association of 3,100 machine makers said Monday.

“Unfortunately, machine-building exports accelerated its downward trend at the beginning of the year,” VDMA president Rheinhold Festge said at a press conference in Frankfurt, where the association is based.

Tensions between Russia and the European Union escalated last week after Russia banned 89 people including politicians from entering the country. European Parliament President Martin Schulz, who is German, said on Saturday that the Russian travel curbs heighten Western wariness of Russia’s foreign-policy goals, diminishing mutual trust and hampering constructive dialogue.

Zeppelin GmbH, which sells and services construction and mining equipment, said in November it’s losing business to Asian competitors in the wake of sanctions imposed by the European Union following the Russia-Ukraine conflict.

Scania AB, the largest foreign seller of heavy trucks in Russia, is forecasting that the country’s commercial-vehicle market will bounce back sharply in 2016. While scaling back production, the Swedish manufacturer doesn’t plan to shutter its Russian plant and truckmakers from Europe are likely to stay in the local market, Hans Tardell, managing director of Scania’s business in the country, said in May.

Ukraine has been battling separatists in the east for more than a year in a conflict that has claimed more than 6,100 lives and led to the biggest confrontation between Russia and the U.S. and Europe since the Cold War.