Dive Brief:
- President Joe Biden announced new sanctions against Russia on Friday and said he will work with Congress to end permanent normal trade relations with the country.
- The president signed an executive order that bars imports of alcohol, seafood and non-industrial diamonds from Russia. Exports of luxury goods to Russia are also prohibited.
- The order additionally empowers the Secretary of the Treasury to prohibit new private investment in any sector of Russia's economy in consultation with the Secretary of State. Certain federal agencies are also authorized to add other products to the list of banned imports and exports in the future.
Dive Insight:
The U.S. and other countries are working to downgrade Russia's trade status in a move that could pave the way for higher tariffs on a wide range of goods.
Biden threw his support behind a bill that would revoke Russia's "most favored nation" trade status, a World Trade Organization benefit that prohibits countries from discriminating between trading partners. Only two other countries — North Korea and Cuba — do not have normal trade relations with the U.S.
Speaker Nancy Pelosi said the House will take up legislation to downgrade Russia's trade status next week.
The Group of Seven (G7) nations is pursuing similar action against Russia and taking steps to limit the country from obtaining financing from international financial institutions including the International Monetary Fund and the World Bank, according to a statement.
"The United States and our Allies and partners continue to work in lockstep to ramp up the economic pressure on Putin and to further isolate Russia on the global stage," Biden said Friday.
New sanctions come a day after Russia banned exports of over 200 products including medical and tech equipment. The majority of U.S. imports from Russia are natural resources, including coal and precious metals.
Russia is not one of the top exporters of spirits to the U.S., according to the Distilled Spirits Council of the United States. Vodka from Russia comprised just 1.2% of the total imported to the U.S. during the first half of 2021.
