US Congress votes to end normal trade ties with Russia

Biden administration taking further steps to put pressure on President Vladimir Putin

After Congress approved two bills to suspend normal trade relations with Russia, these now go to US President Joe Biden to be signed into law. AP

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Congress voted overwhelmingly on Thursday to suspend normal trade relations with Russia and ban the importation of its oil, ratcheting up the US response to Russia’s invasion of Ukraine amid reports of atrocities.

House action came after the Senate approved the two bills with 100-0 votes. The measures now go to President Joe Biden to be signed into law.

“This is something the president supports, had called for and certainly plans to sign it,” White House Press Secretary Jen Psaki told reporters.

Lawmakers overwhelmingly support the substance of the two bills, but they had languished for weeks in the Senate as they worked to hammer out the final details.

“America is unwavering in our commitment to the Ukrainian people, and the Congress will continue to hold Russia to account,” House Speaker Nancy Pelosi said in a prepared statement.

Ms Pelosi is currently quarantining after testing positive for Covid-19.

Mr Biden announced the step in a speech last month arguing that Russia must “pay the price” for the bloodshed in its ex-Soviet neighbour, where it has denied accusations of committing atrocities.

“[Russia's president Vladimir] Putin must absolutely be held accountable for the detestable, despicable war crimes he is committing against Ukraine: the images we have seen coming out of that country … are just pure evil,” said Senate Majority Leader Chuck Schumer.

“It reminds us of the worst moments in human history, caused by the evil man, Putin: hundreds of civilians murdered in cold blood.”

A key principle of the World Trade Organisation, the so-called most favoured nation status known in the US as permanent normal trade relations, requires countries to guarantee one another equal tariff and regulatory treatment.

The latest trade sanctions — which also apply to Russia's ally Belarus — cap several rounds of measures intended primarily to sever Moscow's economic and financial ties with the rest of the world.

They have included banning Russian oil imports, seizing the assets of billionaires tied to Mr Putin, and freezing the nation's stockpile of cash.

Together, the moves have already pushed Moscow to the brink of a debt default.

The steps have also caused prices for key commodities, like gasoline and wheat, to soar, harming US consumers already facing the highest inflation in four decades.

The US imported just under $30 billion in goods from Russia last year, including $17.5bn in crude oil.

The trade relations element of the legislation includes a measure to reauthorise Magnitsky Act sanctions that target human rights violations and corruption with visa bans, asset freezes and other penalties.

The US on Wednesday moved to block foreign investment in Russia and state-owned enterprises and levied further sanctions on the country's banks and senior officials.

Secretary of State Antony Blinken told NBC News that global punishments had put the Russian economy into a “deep recession".

“And what we're seeing is a likely contraction of the Russian economy by about 15 per cent,” he said.

“That is dramatic … We've seen an exodus from Russia of virtually every major company in the world. And Putin, in the space of a matter of weeks, has basically shut down Russia to the world.”

Agencies contributed to this report

Updated: April 07, 2022, 7:28 PM