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U.S., European allies intensify economic pressure on Russia -Breaking


© Reuters. U.S. Vice President Joe Biden makes a gesture as he boarded Air Force One from Joint Base Andrews in Maryland. He was traveling to Philadelphia on March 11, 2022. REUTERS/Jonathan Ernst

Francesco Guarascio and Steve Holland

WASHINGTON/BRUSSELS – Friday saw the United States and European Union intensify their economic pressure against Russia. They moved to remove Moscow from privileged trade and economic treatment, and also to penalize it for invading Ukraine.

U.S. President Joe Biden claimed that these new measures will compound the problems in a Russian economic system already severely impacted by the previously announced sanctions. These have devalued the Russian rouble, and caused the stock market closure.

Biden stated that ending normal trade relations would be a devastating blow for the Russian economy which has already been severely affected by the sanctions.

This fourth round of sanctions was announced by G7 allies, including the United States and EU. It is in reaction to Russia’s February 24 invasion.

These include attempts to eliminate Moscow’s status as a “most-favored country” in trade, opening up the possibility of banning Russian products or imposing punitive taxes on them. This would place Russia on par with North Korea and Iran.

As a blow against the Russian elites, they will ban exports of luxury goods from Russia’s countries.

The EU will first prohibit Russia’s imports of steel and iron sector goods. Ursula von der Leyen, President of the European Commission, stated that Russia was being asked to withdraw its membership of the major multilateral institutions such as the International Monetary Fund (IMF) and the World Bank. The EU is also trying to crack down on Russia’s use of crypto-assets.

The Commerce Department announced that the United States has placed a ban on all luxury exports from Russia and Belarus, including watches, cars, clothing, alcohol, jewelry, and vehicles.

Congress of the United States would have to approve legislation in order to revoke Russia’s trading status. Lawmakers are moving in this direction. In addition to closing down the development funds, the United States announced that it would also ban imports from Russia of seafood, vodka, and diamonds. According to the White House, Biden will ban U.S. investments in Russia outside of the energy sector.

Mineral fuels, precious metals and stones, iron and steel were the top imports of America from Russia. If Congress does not remove Russia’s status as a favored nation, these goods will be subject to increased tariffs.

United States also placed sanctions on Russian oligarchs as well as leaders and elites. These included billionaire Viktor Vekselberg and members of the lower House of Parliament. The new sanctions will be applied to 10 members of VTB Bank’s Board, 12 Duma members, and the family of Dmitry Peskov (Kremlin spokesperson), the U.S. Treasury Department stated.

Invading Ukraine by Russian troops last month was the largest attack on an European country since World War Two. Russia describes the attack as a “special operation.”

In a statement, the White House claimed that Russia can’t grossly infringe international law and continue to enjoy the benefits of being part the international economy order.

After U.S. officials and South Korean officials claimed that Pyongyang used its most powerful intercontinental missile system, the United States imposed new sanctions against Russia.

Britain also imposed sanctions on 386 Duma members, and stated that it would ban Russia’s export of luxury goods. This same group has been sanctioned by the EU.

Britain announced that the sanctions were targeted at those who voted in favor of Ukraine’s independence from the Russian-speaking regions, Luhansk or Donetsk.