Removal from the list of “most favored nations” in effect means that Russia will no longer enjoy “permanent normal trade relations” with the West, and the latter will be allowed to impose higher tariffs on Russian imports.
US President Joe Biden announced on Friday that America, along with the European Union and G7 countries, will boot Russia off the list of so-called “most favored nations” for trade.
“As Putin continues his merciless assault, the United States and allies and partners continue to work in lockstep to ramp up the economic pressures on Putin and to further isolate Russia in the global stage,” Biden said. “Revoking PNTR [permanent normal trade relations] for Russia is going to make it harder for Russia to do business with the United States.”
The American president said that the US and G7 partners will ensure that Russia cannot obtain financing from the International Monetary Fund (IMF) and World Bank.
He also noted that the US authorities will be allowed to ban future investments in any sector of the Russian economy. According to the US president, the sanctions that have already been imposed on Moscow are “crushing” the Russian economy – and there are more to come.
Biden also announced that Washington will work to ban vodka, seafood and diamonds being imported from Russia. The US will also ban the export of its luxury goods to Russia.
Among other goods that are likely to have higher tariffs for import slapped on them are uranium, rhodium, palladium, and silver bullion.
Furthermore, the US president said Russia will “pay a severe price” should it use chemical weapons in Ukraine. Biden also revealed that he spoke to his Ukrainian counterpart, Volodymyr Zelensky, and “told him – as I have each and every time I’ve spoken to him – that the United States stands with Ukraine […] as they bravely fight to defend their country and they are doing that.”
The decision to end normal trade relations with Moscow comes in the wake of a number of anti-Russian sanctions which were imposed on Moscow by the West after the Kremlin launched a military operation in Ukraine. In early March, Canada revoked the “most favored nation” status in trade for Russia and Belarus.
Countries that have the “most favored nation” status are required to treat each other equally. About 180 countries have this status; among those which don’t are Cuba and North Korea.
Russia launched a military operation in Ukraine on 24 February, with the intention of “demilitarising and de-Nazifying” the neighbouring country. Moscow emphasised that the Russian armed forces are only targeting military infrastructure and will not pose a threat to civilians.
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