Biden intends to end Russia’s ‘most favored nation’ trade status

President Joe Biden on Friday will call for the US to revoke Russia’s “most favored nation” status, a downgrade as a trading partner that could open the door to damaging new tariffs on Moscow over its invasion of Ukraine.

Biden is expected to make that announcement during remarks from the White House at 10:15 a.m., a senior administration official told CNBC and NBC News.

The European Union and the Group of Seven nations will move to take the same step, multiple outlets reported. Canada already removed Russia’s most favored nation status last week.

Congress must act to cancel Russia’s trade classification as a member of the World Trade Organization. Bipartisan lawmakers have broadly supported non-military efforts to punish Russia, and some have already called to revoke Moscow’s WTO status. 

“I think we should use Article 21 ability under the WTO to revoke that,” Sen. Rob Portman, R-Ohio, said Thursday during a Foreign Relations Committee hearing.

The House this week also overwhelmingly supported legislation that requires the U.S. Trade Representative to consider suspending Russia’s participation in the WTO.

Biden’s announcement will mark the latest push by the U.S. and dozens of other countries to ratchet up their unprecedented efforts to isolate and undermine Russia’s economy in response to President Vladimir Putin’s invasion of Ukraine.

President Volodymyr Zelenskyy of Ukraine, who has been interviewed from a bunker in the capital of Kyiv even as Russian forces approach the city, had directly asked Congress over the weekend to revoke Russia’s most favored nation status.

Biden this week signed an executive order intended to ban Russian oil imports. The U.S., EU and NATO countries have slapped sanctions on Russian business, its elite oligarchs and even Putin himself, while a growing list of major corporations have pulled their business out of the country.

If its trade status is revoked, the Biden administration and Congress will be able to slap taxes on any goods Russia exports to the U.S.

Russia was the U.S.′ 26th-largest trading partner in 2019, according to the Office of the U.S. Trade Representative. Russian exports to the U.S. in 2021 totaled $29 billion, the majority of which comprised oil and gas products.

SOURCE: CNBC