Biden calls for suspending normal trade relations with Russia and will ban imports of vodka and seafood

By Kaitlan Collins, Manu Raju, Kate Sullivan, MJ Lee and John Harwood, CNN

President Joe Biden on Friday called for suspending normal trade relations with Russia and said the US would ban imports of seafood, vodka and diamonds from the nation as part of an effort to ramp up economic pressure on Russia for invading Ukraine.

Biden said the US, along with the G7 and European Union, will call for revoking “most favored nation” status for Russia, referred to as permanent normal trade relations in the US. The status means two nations have agreed to trade under the best possible terms, which can include lower tariffs, fewer barriers to trade and high imports, Biden said.

The move requires approval from Congress and legislation is expected to be introduced following Biden’s announcement.

“Revoking PNTR for Russia is going to make it harder for Russia to do business with the United States and doing it in unison with other nations that make up half of the global economy will be another crushing blow to the Russian economy that’s already suffering very badly from our sanctions,” Biden said.

The President said, “Many issues divide us in Washington, but standing for democracy in Ukraine, pushing Russia’s aggression should not be one of those issues. The free world is coming together to confront Putin.”

The President also thanked House Speaker Nancy Pelosi for being a “strong advocate” on this issue and for holding off on the legislation in the House of Representatives “until I could line up all of our key allies to keep us in complete unison.”

Biden announced the US would ban goods from several signature sectors of Russia’s economy, including seafood, vodka and non-industrial diamonds. The White House says this will deny Russia more than $1 billion in export revenues.

The President will also sign an executive order ending the exportation of luxury items — including spirits, tobacco, clothing, jewelry, cars and antiques — to Russia.

Biden spent 49 minutes on the phone with Ukrainian President Volodymyr Zelensky on Friday as he laid out in detail the new measures he was about to announce regarding US trade with Russia, two officials familiar with the call told CNN.

While most of the calls between the two leaders since Russia’s invasion have hovered in the 30- to 40-minute range, this was one was a bit longer as Biden highlighted how the US was moving to suspend normal trade relations in another effort to punish the Kremlin.

Zelensky tweeted that he had given Biden an “assessment of the situation on the battlefield, informed about the crimes of Russia against the civilian population” and they had agreed on “further steps to support the defense of Ukraine and increase sanctions against Russia.”

A White House official told CNN the administration’s goal is to continue hurting Russian oligarchs and the country’s wealthiest people by depriving them of their creature comforts, as the US continues to try to put pressure around those close to Putin. It is also aimed at removing ways for these oligarchs to shelter their money, as they are already increasingly closed off from traditional financial avenues, the official said.

The US imported 48,867 metric tons of seafood from Russia in 2021, worth about $1.2 billion, according to the National Oceanic and Atmospheric Administration. Crab accounted for the largest portion of those imports, with the US buying more than $900 million worth of frozen snow and red king crab last year. The US does not sell any seafood directly to Russia, as the country banned US exports of seafood and fish in 2014.

Imports of Russian vodka to the United States accounted for only 1.3% of total vodka imports in in 2021, according to the Distilled Spirits Council of the United States. The total amounts to $18.5 million dollars in 2021, the Distilled Spirits Council of the United States said.

The President also announced G7 leaders would seek to deny Russia the ability from borrowing from the International Monetary Fund and the World Bank.

“We’re going to continue to squeeze Putin,” Biden said, adding that “Putin must pay the price,” for launching an unprovoked attack on Ukraine.

“The G7 is also stepping up pressure on corrupt Russian billionaires — we’re adding new names to the list of oligarchs and their families that we’re targeting and we’re increasing coordination among the G7 countries to target and capture their ill begotten gains. They support Putin. They steal from the Russian people and they seek to hide their money in our countries,” Biden said.

CNN reported Thursday that bipartisan talks in the Senate had been taking shape to take more aggressive action on Russia’s trade status — after the White House effectively watered down the House-passed bill banning importing Russian oil, natural gas and coal into the US.

The earlier version of the legislation had included a provision that would suspend permanent normal trade relations for Russia and Belarus. But the White House expressed concerns over that part of the bill, and ultimately it was excised. The bill banning Russian energy imports that passed the House Wednesday night instead simply called for a review of Russia’s status in the World Trade Organization.

Senate Finance Chairman Ron Wyden, a Democrat of Oregon, told CNN that he was engaging in talks with the top tax writers in Congress and the Biden administration about the matter, as pressure grew to include tougher language in the House bill when the Senate takes it up — as soon as next week.

“I believe the Russians — the inhumane behavior of Russia does not justify it to get the fruits of the international community,” Wyden told CNN.

Sen. Mike Crapo, an Idaho Republican and the ranking Republican on the Finance Committee, said he probably wouldn’t support the House bill without stronger language on its trade status — and made clear there would be an effort to amend it.

“The question is PNTR, which is absent. And then they had some other stuff on the WTO in there, which is kind of hollow if we don’t do PNTR,” Crapo said earlier in the day. “So, I probably would not support it because it doesn’t have the key things that you need for a proper trade response.”

This story has been updated with additional details Friday.

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