President Joe Biden advanced with sanctions against Russia and put more pressure on Vladimir Putin’s regime: he announced this Friday that, together with the G7 countries and the European Union, he will remove Russia’s commercial status from “MFN”, and also prohibited the importation of Russian alcohol, diamonds and fish.
Biden made the announcement at the White House and hit Putin hard whom he called “aggressor” and “autocrat”. However, he confirmed that the US and its allies would not wage war against Russia in Ukraine and said he was seeking to “avoid” a “direct confrontation between NATO and Russia” because it would provoke the “third World war”.
At the end of his speech, Biden answered a question about the possibility of President Vladimir Putin using chemical or biological weapons in Ukraine. “Russia is going to pay a very severe price if it uses chemical weapons”the Democrat said tersely before leaving.
A senior US defense official had said on Thursday that the US had seen “indications” that Russia would use a fake operation on a possible Ukrainian biochemical arsenal. as a pretext for the potential use of chemical agents in some attack.
Like Cuba and North Korea
Biden presented his new battery of trade sanctions against Russia. The initiative announced this Friday requires an act of Congress to be implemented.
It means that will revoke “normal” business relationships with Russia so that country would add Cuba and North Koreathe only ones for now excluded by the world’s leading power from the principle of reciprocity, the basis of most international trade relations.
The move, Biden said, “will make it much more difficult for Russia to do business with the United States.” would enable to place higher tariffs in Russian products, a way to punish the Kremlin for the invasion of Ukraine. Thus, it would join the countries of the G7 and the European Union, which must activate their own national processes to implement it.
vodka and caviar
Biden also announced a ban on the importation of some flagship products from Russia such as alcohol (mainly vodka), fish products (caviar) and diamonds. “Putin is the aggressor. He cannot pursue a war by threatening the foundations of international peace,” he said.
“Putin is the aggressor. He cannot pursue a war by threatening the foundations of international peace,” Biden said. Photo: AFP
In the US Congress, the House and Senate have already proposed legislation requiring this measure, along with the ban on imports of Russian oil, gas and coal, which Biden announced this week.
This initiative would end the US policy of treating Russia as a most-favored nation, a key principle of the World Trade Organization that requires member countries to ensure equal tariff and regulatory treatment to other members.
The loss of status means that some Russian imports will be subject to higher tariff rates, such as those currently imposed on North Korea and Cuba.
This step, if implemented in coordination with other major nations, would have a significant impact in damaging Russia’s trade. Canada adopted just such a measure last week, subjecting all imports from Russia and Belarus to a 35% tariff. The EU is considering a similar step.
“The more countries that take this action, the more effective the sanctions will be,” said Inu Manak, trade policy fellow at the Council on Foreign Relations. “If the allies coordinate to remove Russia’s trade concessions, the impact on the Russian economy will be strong.”
According to the WTO, the EU is the most important destination for Russian exports, since it buys 41% of the total value, followed by China with 13.4%.
The actual impact of the measure on US commerce and consumers will be limited, given the volume relatively little bilateral trade with Russia.
According to the Census Bureau, Russia was the 23rd largest trading partner of the United States in 2021 with $36.1 billion in goods traded in both directions. Of that amount, $29.7 billion was imports of Russian products into the United States, including fuels, precious metals, and iron and steel.
The administration has already announced a ban on Russian oil, coal and gas, which account for roughly 60% of total imports of the United States from the country. The tariff rate on specialty metals like uranium and palladium, another big import category, will remain zero even if Russia’s status changes.
The proposed legislation also calls for Russia’s expulsion from the WTO. That is a symbolic gesture because the step would require a time-consuming effort to gain consent from more than 100 member countries.
Biden also said they will seek with allies to block Russia’s access to funds from international organizations such as the International Monetary Fund and the World Bank.