US-Russia trade increases 17% post sanctions: report
30 Jul 2014
The Obama administration's economic sanctions against Russia in the wake of the conflict in Ukraine and Russia's alleged involvement in fanning anti-West sentiment among the Ukranian people have only resulted in increased US-Russia trade, say reports.
McClatchyDC quoted US Census Bureau foreign trade data as showing that trade between the United States and Russia actually increased by 17 per cent in the three-month period after the first sanctions were imposed on 6 March, compared with the previous three months.
The value of exports has risen in each consecutive month this year, the report points out.
Russian markets account for less than 1 per cent of US exports, but US sales to Russia consist largely high-tech and expensive goods, including technology and equipment for the energy sector.
US product exports to Russia, consisting mostly of a few big-ticket items such as airplanes and cars, added up to just $5.1 billion in the first five months of the year, although the sales drove up the percentage increase in trade figures.
In the first round of sanctions, imposed on 6 March, President Barack Obama targeted primarily individuals close to Russian President Vladimir Putin and those linked to the invasion and annexation of Crimea.
The latest round, imposed earlier this month for alleged Russian assistance to separatist groups in eastern Ukraine, however, includes Gazprombank, the financial wing of Russia's state-owned and largest natural gas company as also major energy companies Novatek and Rosneft.
The US administration is preparing tough new sanctions against Russia, adding to those levied this month, to expand the sanctions list.
Senators, including Dianne Feinstein (Democrat-Calif), Robert Menendez (Democrat-NJ) and Carl Levin (Democrat-Mich), have written a letter to President Barack Obama demanding yet more sanctions against Russia.
"We strongly urge you to aggressively exercise your authorities under the International Emergency Economic Powers Act and other relevant statutes to impose immediate broad sanctions against Russia's defense sector, including state-owned Rosboronexport, in order to prevent Russia from providing weaponry, equipment, or assistance and training to separatists in Ukraine."
According to trade experts, the spike in exports may be due to Russian stockpiling of US goods fearing they may not get them in future.
The $5.1 billion of US-Russian trade in the first five months of this year included US sale of eight Boeing civilian aircraft costing $1.39 billion, $1 billion in machinery and $227 million in mining, oil, and gas equipment as also a 95 per cent increase in cars and trucks.
The US Chamber of Commerce, however, is opposing further sanctions, and McClatchy quoted Myron Brilliant, head of the chamber's international affairs, as saying, "The fact that the US accounts for less than 5 per cent of Russia's international commerce will limit the sanctions' impact on Russian policy."
Leslie Beyer, president of the Petroleum Equipment Suppliers Association, also expressed fears that further sanctions could hurt US business, causing "Obstruction to ongoing operations would hinder domestic job growth and simply open the door to foreign competitors."
Tony Blinken, a national security adviser to Obama, told The Guardian, "We expect the European Union to take significant additional steps this week, including in key sectors of the Russian economy. In turn, and in full coordination with Europe, the United States will implement additional measures itself."
