US president Joe Biden said on March 11 the Group of Seven industrial nations plans to revoke Russia’s status as a “most favored nation.”
The move, which still has to be approved by Congress, sets the stage for the US and other G7 members to impose tariffs and other trade barriers on Russia. Additionally, the US is banning Russian seafood, vodka, and diamonds.
The announcement is part of a barrage of economic sanctions the US has levied against Russia after its unprovoked invasion of Ukraine. Over the course of the conflict, Russia has bombed a maternity hospital, targeted civilians, and attacked a nuclear power plant. The US State Department and Ukrainian president Volodymyr Zelenskyy have said they believe Russia is considering using chemical and biological weapons.
While sanctions have predominantly been a US tool since World War II, the latest round of economic penalties against Russia has been a collective effort, including the US, the EU, UK, and other G7 countries.
What will be the fallout of trade restrictions?
The countries behind the new measure are huge buyers for Russian products, from oil and gold to fertilizer and fish. Restricting access to those markets, particularly the EU, will put further economic pressure on Russia’s main revenue streams.
Among the G7 countries, the Netherlands, UK, and Germany are the biggest importers of Russian goods.
New trade restrictions will hit Russia’s fuel and nickel exports
While Russia’s largest export by far is fuel, it’s also a big exporter of other products such as precious metals, gems, iron, and steel. Trade restrictions would also be burdensome for buyers. Here’s a look at how much the top G7 importers of these products spend on them: