US President Joe Biden was yesterday set to call for an end of normal trade relations with Russia, clearing the way for increased tariffs on Russian imports, people familiar with the matter said.
His announcement to revoke the trade privileges was to come alongside similar measures by G7 nations and EU leaders, the people said.
The president cannot unilaterally change Russia’s trade status because that authority lies with the US Congress, where Democratic and Republican lawmakers have called for the revocation.
Photo: Bloomberg
Suspending normal trade relations with the US, which other countries call “most favored nation status,” would put Russia in the company of countries such as Cuba and North Korea.
It would allow the US to hit Russia with significantly higher tariffs than it applies to other WTO members, which has as a core principle of non-discrimination among members and treating all members equally.
Just like the US, the other countries calling for the repeal over Russia’s invasion of Ukraine go through their own processes, the people said.
Russia is far more dependent on the EU than the US, selling about one-third of its exports to the bloc, versus just 5 percent to the US in 2020, IMF data showed.
The EU last week said that it was seeking to remove Russia’s most-favored nation status, and Canada withdrew the designation from Russia.
Leaders in the US House of Representatives and Senate have pushed for the repeal of preferential trade relations, but earlier this week, the provision was removed from a bill banning Russian energy imports.
Lawmakers criticized the White House for asking that the provision be struck as talks with allies were ongoing.
On Thursday night, US Senator Rob Portman said that he has a bill with US Senator Ben Cardin to revoke Russia’s trade status, adding that it is important that Biden also has allies following suit.
“It’s much more effective if they all do it,” Portman said in an interview at the Capitol. “For us it’s not a big deal, but for Europe it’s huge, and it’s the right thing to do. Access to our market is a privilege, not a right.”
The UK yesterday slapped a fresh wave of sanctions on Moscow, targeting 386 members of Russia’s parliament who supported Russian President Vladimir Putin’s invasion of Ukraine.
The new sanctions against members of the Duma ban them from traveling to the UK, as well as accessing any assets they hold in Britain.
The lawmakers were sanctioned after they voted last month to recognize the breakaway republics of Lugansk and Donetsk in eastern Ukraine, providing a pretext for the war, the British Foreign, Commonwealth and Development Office said.
“We’re targeting those complicit in Putin’s illegal invasion of Ukraine and those who support this barbaric war,” British Secretary of State for Foreign, Commonwealth and Development Affairs Liz Truss said.
“We will not let up the pressure and will continue to tighten the screw on the Russian economy through sanctions,” she said.
Additional reporting by Reuters
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