Biden calls for an end to Russia’s ‘most favored nation’ trade status

President Joe Biden on Friday called for the U.S. to revoke Russia’s “most favored nation” status, which would downgrade Russia as a trading partner and open the door to damaging new tariffs on Moscow over its invasion of Ukraine.

The European Union and the Group of Seven nations are expected to take the same steps, Biden said. Canada already removed Russia’s most favored nation status last week.

Biden will also sign an executive order to ban U.S. imports of seafood, non-industrial diamonds and vodka and liquors from Russia.

Biden repeatedly singled out Russian President Vladimir Putin, who rules the country as an autocrat.

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

In order to cancel permanent normal trade relations with Russia, Biden will need action from Congress. Specifically the House and Senate need to revoke Russia’s classification as a member of the World Trade Organization. 

Biden is not expected to encounter serious resistance from Congress on this. Both Republicans and Democrats have strongly supported non-military efforts to punish Russia, and some have already proposed legislation to revoke Russia’s WTO membership. 

“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 banning Russian oil imports. The U.S., EU and NATO countries have imposed sanctions on Russian businesses, its elite oligarchs and even Putin, while a growing number of major corporations have pulled their business out of the country.

If Russia’s trade status is revoked, the Biden administration and Congress will be able to impose 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.