Biden moves to strip Russia of preferred trade status

US President announces additional bans on iconic Russian goods

US President Joe Biden on Friday moved to revoke Russia of its preferred trade status as it continues to ratchet up economic pressure on Moscow. AFP

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US President Joe Biden moved on Friday to revoke Russia's “most favoured nation” trade status over its invasion of Ukraine, joining other allies to continue punishing the country.

Friday's move will also clear the way to increase tariffs and bans on iconic Russian imports. The president announced the US would also add new names to a list of sanctioned Russian oligarchs.

“Those are the latest steps we're taking but they're not the last steps we're taking,” he said.

Mr Biden, wearing a blue and yellow-striped tie while delivering remarks from the White House, said the US is co-ordinating closely with its allies to ratchet up the pressure on Russia's economy.

“The United States and our allies and partners continue to work in lockstep to ramp up the economic pressures on Putin and to further isolate Russia and the global stage,” Mr Biden said.

Other Group of Seven (G7) nations announced similar trade measures against Moscow, saying they are working to prevent Russia from receiving financing from leading multilateral financial institutions.

“We are united in our determination to hold President Putin and his regime accountable for this unjustified and unprovoked war that has already isolated Russia in the world,” the G7 said in a joint statement released by the White House.

In the US, removing Russia's “Permanent Normal Trade Relations” (PNTR) status will require an act of Congress, the White House is expected to co-ordinate with lawmakers to revoke the status.

Mr Biden applauded Democratic and Republican leaders for drumming up bipartisan support for the action.

Congress on Thursday gave final approval to deliver $13.6 billion in aid to Ukraine, part of a $1.5 trillion package that received widespread bipartisan support. The funds provided to Ukraine will provide military equipment as well as humanitarian assistance to Kyiv.

“We will send money and food and aid to save the Ukrainian people,” Mr Biden said.

“I will welcome Ukrainian refugees. We should welcome them here with open arms.”

Suspending normal trade relations puts Russia in the company of countries like Cuba and North Korea. It will allow the US to place significantly higher tariffs on Russia than it applies to other World Trade Organisation members.

“Putin is the aggressor,” Mr Biden said. “And Putin must pay the price.”

Mr Biden also announced that the US is banning Russian imports of diamonds, seafood and alcohol. The move affects only a fraction of US imports, but hits major Russian goods including vodka and caviar.

Unprecedented sanctions imposed on Moscow by the US and allies have already caused Russia's economy to crumble, leaving the rouble effectively worthless.

The International Monetary Fund predicts Russia will plunge into a “deep recession” this year.

Agencies contributed to this report