Sources: US, G7 allies move to strip Russia of ‘most favored nation’ status

US President Joe Biden holds a virtual meeting with business leaders and state governors to discuss supply chain issues, particularly semiconductor wafer processing, on the White House campus in Washington, US, March 9, 2022. REUTERS/Jonathan Ernst

WASHINGTON (Reuters) – The United States, the Group of Seven and the European Union will move on Friday to revoke Russia’s “most favored nation” status over its invasion of Ukraine, several people familiar with the situation said. Reuters.

One of the sources, who spoke on condition of anonymity, said President Joe Biden will announce the plans at the White House at 10:15 a.m. EDT (1515 GMT).

The White House said Biden would announce “measures to continue to hold Russia accountable for its unjustified and unjustified war on Ukraine,” but gave no details.

Russia describes its actions in Ukraine as a “special operation.”

Stripping Russia of its favored status clears the way for the United States and its allies to impose tariffs on a wide range of Russian goods, which will add to the pressure on an economy already heading into a “deep recession.”

Coordinated moves by Washington, London and other allies come on top of an array of unprecedented sanctions, export controls and banking restrictions aimed at pressuring Russian President Vladimir Putin to end Europe’s biggest war since World War Two.

Two people said that each country should implement the change in Russia’s trade situation based on its national operations.

In the United States, repealing Russia’s “permanent normal trade relations” (PNTR) status would require congressional action, but lawmakers in both houses — and on both sides of the political aisle — have already signaled their support, two officials said.

“President Biden and the administration appreciate the bipartisan leadership of Congress and his calls to repeal the PNTR,” one official said, adding that the White House would work with lawmakers on legislation to repeal Russia’s status.

Unprecedented sweeping sanctions on Russia’s banks and elites, along with export controls on a raft of technologies, have already brought the Russian economy to its knees, and the International Monetary Fund now predicts that it will plunge into a “deep recession” this year.

In 2019, Russia ranked 26th among the largest trading partner for goods of the United States, with about $28 billion exchanged between the two countries, according to the Office of the US Trade Representative.

Major imports from Russia included mineral fuels, precious metals, stone, iron and steel, fertilizers and inorganic chemicals, all goods that could face higher tariffs once Congress takes action to revoke Russia’s preferred country trade status.

On Tuesday, Biden imposed an immediate ban on Russian oil and energy imports. Read more

Some US governors have already ordered government-run liquor stores to stop selling Russian-made vodka and distilled spirits in solidarity with the Ukrainian people. Read more

(Steve Holland and Andrea Shalal report in Washington). Editing by Christopher Cushing and Michael Berry

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