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. Last Updated: 07/27/2016

Foreign Traders Barred From Markets

MTAn Azeri trader's nearly empty stall at the Leningradsky market on Sunday
The few foreigner traders working at Moscow's Leningradsky outdoor market whispered Sunday that they were selling off the last of their eggplants and potatoes and then would leave for good.

The foreigners, mostly Azeris, were keeping a low profile because they weren't supposed to be selling anything under a law that went into force Sunday and bars all foreigners from working in outdoor markets.

"Half the market is empty," said Vagit, an Azeri trader selling eggplants, tomatoes and mounds of green parsley and dill. "Half of the Azeris have left, and the rest will follow soon."

At a nearly empty vegetable stall, an Azeri woman said she would leave once she sold the last potato.

Dozens of traders were working at the market in northern Moscow on Sunday even though it was officially closed for a sanitary day. It was not clear whether the closure was linked to the new law. Russian traders said such cleanups were regularly planned for the first day of the month. But Azeri traders said this was the first sanitary day in a long time.

One in every three stalls in the city's clothes and food markets have stood empty since the first phase of the new law kicked in on Jan. 15. But Sunday's change, economists say, could lead to widespread labor shortages and price hikes across the country.

The Federal Migration Service is signaling that it will be cautious in implementing the law. "We are not planning anything: no document checks, no market raids. We're working as usual," Denis Soldatikov, a spokesman for the service, said Friday.

Traders at the Leningradsky market said there had been no checks Sunday, but some were expecting them for Monday.

Soldatikov said the law would only be fully implemented in December. In an indication of the turmoil the law has caused in government circles, he added: "This is not an enforceable law. It is simply a government regulation initiated by Zurabov's ministry. It is not the direct responsibility of our department."

Health and Social Development Minister Mikhail Zurabov told a recent Cabinet meeting that the upcoming changes would have minimal effect on the retail sector.

Zurabov also insisted that the displacement of the first foreign traders in January had not emptied stalls or prompted a lack of variety of goods or noticeable price increases.

In contrast to Zurabov's assurances, however, figures collected by the State Statistics Service indicate that markets are suffering shortages in labor and goods.

Since mid-January, only two-thirds of the stalls in Moscow markets are being used, and the number drops to 45 percent to 49 percent in St. Petersburg, Smolensk and Tambov, the agency said in a report prepared for the Cabinet in late February.

The report said sales of foodstuffs -- including meat, fish, sugar and vegetable oil -- as well as clothes had dropped in many regions, particularly in Chita and Khabarovsk in the Far East.

Economic Development and Trade Minister German Gref has warned that the restrictions on foreigners would hurt the national economy. He said sales at the markets amounted to 19.6 percent of all retail trade last year, but the figure shrunk to 16.9 percent after January. Only 72 percent of stalls are being used throughout the country, he said, and up to 60 percent of places reserved for Russian farmers remained empty.

The law is designed to streamline migration laws and reduce the influx of migrant workers, mainly from other former Soviet republics, who have traditionally dominated the country's outdoor food markets.

As of Jan. 15, the number of foreigners allowed to work in the markets was cut to 40 percent of the total workforce. Fines in the thousands of dollars have been imposed on those violating these rules.

The situation on the ground indicates that Sunday's measures might put outdoor markets on the verge of crisis.

Migrant traders at the Cheryomushkinsky market in southwest Moscow were bracing themselves Saturday for hard times. Vegetable vendors, mainly from Azerbaijan and Uzbekistan, stood in small groups, discussing the April 1 deadline.

"No more foreigners from tomorrow," said Oleg, who declined to give his last name. "At any rate, the market will close down completely for repairs starting April 15." It was unclear whether the timing of the repairs was linked to the law.

Maruf Yusupov, an Uzbek trader, said he was planning to work as a security guard at the market until the dust settles. "Labor shortages will force the authorities to rescind their decision," he said.

At the Dmitrovsky Central Market Tornado-D, outside Moscow, an administrator said it was "unfortunate to let the many foreigners working in the market go." But, she said by telephone, the law forced her to "send them packing."

Some markets appeared to have found a way around the new rules. The Butyrsky food market, for one, has reregistered as a trading center. "The new status means that we are no longer affected by the new migration laws," said a market administrator, who refused to give her name.

It was business as usual at the market on Friday, as migrant vendors sat behind rows of stalls selling fresh fruits and vegetables. Asked about his documents, Ahmed, an Azeri trader who would not give his last name, said only: "Everything is in order."

An administrator at the Danilovsky market said the market had been changed into an open joint stock company and that under the law it would be permitted to hire migrant workers.

Market administrators have a grace period of two months to comply with the new regulations, he said. "They don't have to let people go April 1," he said.

Moscow has been particularly hard-hit with labor shortages arising from the implementation of the first part of the regulation in January.

In February, Vladimir Malyshkov, the City Hall official who oversees retail market issues, said City Hall would petition federal authorities to exempt it from enforcing migration laws banning all migrant vendors from trading in the markets.