In the latest response to Russia’s war in Ukraine, US President Joe Biden has placed a ban on Russian diamonds, seafood, and vodka imports.
He also said that Russia’s status as an equal trading partner will be revoked by Western allies, paving the path for more economic sanctions.
The steps add to the economic isolation that Russia has faced since the invasion.
Its currency has depreciated, and international companies are fleeing the country.
Western sanctions on banks and oligarchs have been compared by Russian President Vladimir Putin to a declaration of war. Moscow has also threatened to nationalise enterprises or industrial sites if activity has been halted.
The next actions, according to Mr. Biden, will be “another crushing blow to the Russian economy.”
Designating a country as a “most favoured nation” provides reciprocal trade benefits such as lower tariffs and border taxes, according to international standards.
The United States is coordinating the removal of Russia’s status with the European Union and other advanced economies, including Canada and Japan, which Mr Biden predicted will follow suit.
“We remain determined to further isolate Russia from our economies and the international financial system,” the G7 leaders, which include the United Kingdom, said in a statement.
In the United States, Congress, which must act before the move can take effect, has already expressed its support for it.
Furthermore, Mr. Biden stated that Western partners wanted to cut Russia off from international financial institutions such as the World Bank and the International Monetary Fund.
Mr. Biden also announced a ban on US luxury goods exports to Russia, a $550 million-per-year trade, as well as additional sanctions against oligarchs and their families.
According to the White House, the US restriction on essential Russian imports will cost Mr Putin more than $1 billion in revenue.
This is a small portion of the $28 billion in trade between the US and Russia in 2019.
The removal of Russia’s preferential trade status allows for increased tariffs on critical products like mineral fuels, fertilisers, and metals.
“We’re going to keep putting pressure on Putin,” Biden stated. “He is the aggressor, and he must pay the consequence,” says the narrator.
Economists predict that the sanctions will plunge Russia into a deep recession this year. However, it is unclear whether Mr Putin’s military aspirations have changed as a result of the economic crisis.
During a news briefing on Thursday, White House spokesperson Jen Psaki was asked if the severity of the sanctions would cause Mr Putin’s behaviour to alter.
“Of course, our goal is to put a stop to this war,” she stated. “In terms of when that will happen, I’m regrettably not in President Putin’s head…. I can’t forecast when that will affect his calculus.”