UPDATE
As retaliation for Russia’s invasion of Ukraine, President Joe Biden said on Friday that the US will drastically lower its trade status with Russia, as well as restrict imports of Russian seafood, vodka, and diamonds.
The European Union and the Group of Seven countries are working together to implement the wide trade change, which would result in Russia losing its “most favored nation” status.
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Informed sources said that the US, along with the Group of Seven and the European Union, will move on Friday to rescind Russia’s “most favored nation” designation for its invasion of Ukraine.
One of the sources, who spoke on the condition of anonymity, said President Joe Biden will announce the plans at the White House at 10:15 a.m. EST (1515 GMT).
Biden would announce “measures to continue to hold Russia accountable for its unprovoked and unlawful aggression on Ukraine,” according to the White House, but no details were provided.
Russia describes its efforts in Ukraine as a “special operation”.
The removal of Russia’s favored nation status opens the door for the US and its allies to apply tariffs on a wide variety of Russian imports, putting even more pressure on an economy that is already in a “deep recession.”
The synchronized steps by Washington, London, and other allies follow a slew of new sanctions, export curbs, and banking restrictions aimed at forcing Russian President Vladimir Putin to halt Europe’s largest war since WWII.
According to two of the people, each country must implement the change in Russia’s trading position based on its own national processes.
The removal of Russia’s “Permanent Normal Trade Relations” (PNTR) status will require an act of Congress in the United States, but politicians in both chambers – and on both sides of the political divide – have already expressed their support, according to two sources.
“President Biden and the administration appreciate Congress’s bipartisan leadership and calls for the suspension of PNTR,” one of the individuals said, adding that the White House will collaborate with lawmakers on legislation to withdraw Russia’s status.
The Russian economy has already collapsed as a result of unprecedented, broad sanctions imposed on Russia’s banks and elites, as well as export limits on a variety of technology, and the International Monetary Fund now predicts that it will enter a “severe recession” this year.
According to the US Trade Representative’s office, Russia was the United States’ 26th largest goods trading partner in 2019, with $28 billion trade between the two countries.
Mineral fuels, precious metals and stones, iron and steel, fertilizers, and inorganic chemicals were among the top Russian imports, all of which might face higher taxes if Congress decides to rescind Russia’s favored nation trading status.
Biden announced an emergency restriction on Russian oil and energy imports on Tuesday.
In sympathy with the Ukrainian people, some US governors have already ordered government-run liquor outlets to stop selling Russian-made vodka and distilled spirits.
