Archyde.com reported on the 10th (local time) that the United States, along with the G7 and the European Union (EU), will deprive Russia of most-favored-nation treatment.
According to reports, US President Joe Biden is expected to end the ‘Permanent Normal Trade Relations’ (PNTR) with Russia at 10:15 a.m. ET on the same day, holding responsibility for the invasion of Ukraine. The PNTR is a trade relationship with the United States that is subject to most-favored-country tariffs without regular review by Congress. Therefore, the termination of the PNTR means that Russia will be stripped of its most-favored-nation status and imposed high tariffs. A source said the announcement was focused on repealing Russia’s trade privileges.
Ending the PNTR requires Congressional approval, which is backed by Congress, Archyde.com reported.
For the US, Russia is the 26th largest trading partner in 2019. The trade volume between the two countries is about 28 billion dollars (34.5 trillion won). The major US imports from Russia are mineral fuels, precious metals, stones, iron ore, steel, fertilizers, and inorganic chemicals. If Russia’s most-favored-nation treatment is deprived, tariffs on these imports will be much higher than the current ones, which will greatly reduce the competitiveness of exports to the US.
In response to Russia’s invasion of Ukraine, Western countries such as the United States and Europe have imposed a wide range of economic sanctions, including asset freezes and export controls, on Russian financial institutions and key figures in the Russian government. The Russian ruble depreciated in the aftermath of the sanctions, and the Central Bank of Russia raised its key interest rate sharply. The International Monetary Fund (IMF) expects Russia to plunge into a serious recession this year.
Earlier this month, President Biden signed an executive order banning Russian oil and energy imports. Some U.S. governors have also banned state-run liquor stores from selling Russian vodka and spirits.