Friday, July 19, 2024

“Most Favored Country”: Biden announces that the United States will move to abolish Russia’s trade status


Biden said the United States, along with the Group of Seven and the European Union, would demand that “most favored nation” status be revoked. Russia, referred to as Permanent Normal Trade Relationships in the United States. That situation means two countries have agreed to trade under the best possible terms, Biden said, which could include lower tariffs, lower barriers to trade and higher imports.

The move requires congressional approval and legislation is expected to be introduced after Biden’s announcement.

“The abolition of Russia’s PNTR will make it difficult for Russia to do business with the United States, and doing so in unison with other countries that make up half of the global economy would be another crushing blow to the already severely suffering Russian economy,” Biden said.

“There are many issues that divide us in Washington, but standing up for democracy in Ukraine and pushing back Russian aggression shouldn’t be one of those issues. The free world unites to confront Putin,” the president said.

The president also thanked House Speaker Nancy Pelosi for being a “strong advocate” on this issue and for deferring legislation in the House “so that I can align all of our key allies to keep us in unison.”

Biden announced that the United States would ban goods from several distinct sectors of the Russian economy, including seafood, vodka, and non-manufactured diamonds. The White House says this will deprive Russia of more than $1 billion in export revenue.

The president will also sign an executive order ending the export of luxury goods — including spirits, tobacco, clothing, jewelry, cars and antiques — to Russia.

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Biden spent 49 minutes on the phone with Ukrainian President Volodymyr Zelensky on Friday detailing new measures he was about to announce regarding US trade with Russia, two officials familiar with the call told CNN.

While most calls between the two leaders since the Russian invasion have hovered in the 30-40 minute range, this was a little longer as Biden highlighted how the United States was moving to suspend normal trade relations in another attempt to punish the Kremlin.

Zelensky wrote on Twitter that he gave Biden an “assessment of the situation on the battlefield, reported Russia’s crimes against the civilian population” and agreed on “further steps to support Ukraine’s defense and increase sanctions against Russia.”

A White House official told CNN that the administration’s goal is to continue to harm Russia’s oligarchs and the country’s wealthy by depriving them of their comforts, as the United States continues to try to pressure those close to Putin. It also aims to remove the avenues these oligarchs are using to protect their money, the official said, as they are already increasingly cut off from traditional financial avenues.

The United States imported 48,867 metric tons of seafood from Russia in 2021, worth about $1.2 billion, according to the National Oceanic and Atmospheric Administration. Lobster made up the bulk of those imports, with the United States buying $900 million worth of frozen ice and red lobster last year. The United States does not sell any seafood directly to Russia, as the country banned US exports of seafood and fish in 2014.

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Russian vodka imports into the United States accounted for just 1.3% of total vodka imports in 2021, according to the United States Distilled Spirits Board. The United States Spirits Board said the total will reach $18.5 million in 2021.

The president also announced that the G7 leaders would seek to deprive Russia of the ability to borrow from the International Monetary Fund and the World Bank.

“We will continue to put pressure on Putin,” Biden said, adding that “Putin must pay the price” for an unprovoked attack on Ukraine.

“The G7 is also ramping up pressure on corrupt Russian billionaires — adding new names to our target list of oligarchs and their families and increasing coordination among the G7 countries to target and seize their ill-gotten gains. They support Putin, steal from the Russian people, and seek to hide their money in our country.”

CNN reported Thursday that bipartisan talks in the Senate were shaping up to take more aggressive action over Russia’s trade situation — after the White House effectively watered down the House decision. Draft law bans import of Russian oil, natural gas and coal in the United States.

The previous version of the legislation included a provision that would suspend the normal permanent trade relations of Russia and Belarus. But the White House expressed concerns about that part of the bill, and it was eventually scrapped. Instead, the bill banning Russian energy imports passed by the House of Representatives Wednesday night called for a review of Russia’s status in the World Trade Organization.

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Senate Finance Chairman Ron Wyden, a Democrat from Oregon, told CNN he has been engaged in conversations with top Congressional tax writers and the Biden administration on the issue, as pressure has grown to include tougher language in the House bill when the Senate takes it up. . Up – as soon as next week.

“I think the Russians – the inhuman behavior of Russia does not justify them reaping the fruits of the international community,” Wyden told CNN.

Senator Mike Crabow, the Republican of Idaho and the ranking Republican on the Finance Committee, said he probably wouldn’t support the House bill without stronger language about its business situation — and made clear that there would be an effort to amend it.

“The question is PNTR, which is absent. And then they had some other WTO stuff in there, which is kind of hollow if we don’t do PNTR,” Krabow said earlier today. “So, I probably wouldn’t endorse it because it doesn’t have the basic things you need for a proper commercial response.”

This story was updated with additional details on Friday.

Rainerio Manuel
Rainerio Manuel

"Infuriatingly humble alcohol fanatic. Unapologetic beer practitioner. Analyst."