MILWAUKEE — The conflict in Ukraine is creating uncertainty for Wisconsin companies that have business ties with the two countries at war.
A Wisconsin-based international trade expert says local companies that export products and goods to Ukraine or Russia are having a difficult time figuring out whether they can proceed, especially now that Fed-Ex and U.P.S. have halted deliveries there.
Wisconsin exported more than $24 billion worth of goods internationally last year alone. While Russia and Ukraine account for just $130 million of that total, dozens of Wisconsin companies are inevitably caught in the middle of the ongoing crisis in Ukraine.
Chris Wojtowicz is an international trade consultant with the Wisconsin Small Business Development Center. Wojtowicz says he’s already heard from small businesses across the state that are unsure whether they can legally ship goods to both countries due to U.S. sanctions on Russia and war in Ukraine.
"That means companies will have to exercise some sort of diligence to make sure that they're not doing businesses in the Ukraine in the affected regions as well as doing business with Russian companies or named persons that are on a denied persons list,” he said.
The Wisconsin Economic Development Corporation says Russia comes in as the state’s 35th largest export destination, receiving $109 million worth of Wisconsin-made products in 2021. Forty percent of that came from industrial machinery and vehicle exports, followed by medical and scientific instruments.
Wojtowicz says he knows of Wisconsin companies in those industries that are halting trades to both countries, because they don’t know how to proceed.
"I would have to believe a majority are being cut off or pushed the pause button if you will,” he said.
Wojtowicz says even if Wisconsin companies can verify that they can legally export goods to Russian and Ukrainian companies that are not affected by sanctions, U.P.S. and Fed-Ex have suspended shipments to both countries in light of the invasion.
“The uncertainty is when a shipment product over there, is it going to be stuck in a warehouse somewhere and of course as you know, small businesses they live payment to payment so they want to make sure that if they’re in some sort of contract that requires delivery they could be out, who knows, it could be a couple months, it could be indefinitely,” he said.
Wisconsin imported $26 million worth of Russian goods last year, the largest amount in a decade.
