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President Joe Biden on Friday called for an end to normal trade relations with Russia, clearing the way for increased import tariffs, and announced a ban on Russian-made vodka and caviar.
Revoking the trading status “is going to make it harder for Russia to do business with the United States,” Biden said in remarks at the White House, adding that it would “be another crushing blow to the Russian economy.”
The president can’t unilaterally change Russia’s trade status because that authority lies with Congress. House Speaker Nancy Pelosi said the House would consider legislation next week revoking Russia’s trade status, a move that has support from both Democratic and Republican lawmakers.
If Congress passes the legislation, Russia would join Cuba and North Korea as the only countries without the status.
The U.S. effort is happening in concert with European Union and Group of Seven nations, Biden said.
Biden also announced Friday that the U.S. is banning imports of Russian alcohol and seafood, a move aimed at targeting goods closely associated with Russia like caviar and vodka.
The U.S. imports around US$24.1 million in beverages, spirits and vinegar annually, with most Russian-branded vodkas produced in other nations. But the U.S. imported US$1.2 billion in seafood last year.
The seafood and alcohol announcement was first reported by the Wall Street Journal.
The U.S. will also ban the import of diamonds and other luxury goods, Biden said.
Suspending normal trade relations, which other countries call most-favored-nation status, would allow the U.S. to hit Russia with significantly higher tariffs than it applies to other World Trade Organization members. The WTO has as a core principle non-discrimination among members and treating all members equally.
U.S. allies have made similar moves. The EU said last week that it’s seeking to remove Russia’s most-favored nation status, and Canada withdrew the designation for Russia.
Russia is far more dependent on the EU than the U.S., selling about one-third of its exports to the bloc, versus just 5 per cent to the U.S. in 2020, according to International Monetary Fund data compiled by Bloomberg.
Leaders in the House and Senate have pushed for the repeal of the preferential trade relations but earlier this week, the provision was removed from a House bill banning Russian energy imports.
The Biden administration has worked with allies and made Congress aware of those conversations, but lawmakers criticized the White House for asking that the provision be struck as those talks were ongoing.
The Senate late Thursday voted to send to Biden for his signature legislation that would provide US$13.6 billion for humanitarian and security aid in response to Russia’s attack on Ukraine.