G7 nations draw up plans to impose heavy tariffs on Russia
Western governments are drawing up plans to impose punitive tariffs on Russian trade amid efforts to further isolate Moscow from the global economy after the invasion of Ukraine.
In a development aimed at ratcheting up the pressure on Vladimir Putin, the G7 group of wealthy nations is considering options to strip Russia of “most favoured nation” (MFN) status under World Trade Organization (WTO) rules.
Such a move would mean imposing tariffs – border taxes paid by importers – on Russian products such as vodka and other goods. Designed to raise the price of goods to discourage trade, tariffs hit exporters but can also add to consumer costs.
Sources said an announcement by the G7 could come as early as Friday, although they also stressed that a desire to maintain international unity and to coordinate sanctions could see the details announced at a later stage.
It comes as the US pushes for tougher action against the Kremlin, with sources telling the Reuters news agency that Joe Biden would use a statement on Friday to remove Russia’s “permanent normal trading relations” with the US – the term used by Washington for MFN status.
The US currently only excludes two countries from this designation: Cuba and North Korea. Rather than tariffs at the current applied rate in the US of about 3% on average across Russian goods, the border tax would increase to more than 10 times that level.
Imposing punitive tariffs on goods sold by Russia to the west would be designed to increase the pressure on the Kremlin, in a move similar to tactics used by the former US president Donald Trump to exert pressure on China amid a bitter dispute between Washington and Beijing.
The move would be largely symbolic for the US given the relatively limited export
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