The U.S. Commerce Department said Thursday it had removed Russia from its market economy classification in a bid to put pressure on Russia in the context of bilateral trade and further isolate its economy.
The Commerce Department’s decision was due to increased interference by the Russian government in its own economy, resulting in price distortions and disadvantages for American businesses. It is a retaliation by the US government for aggression and gives the ability to apply the full range of US anti-dumping laws against Russian imports.
“Based on a balanced assessment of the facts, and in line with U.S. law, this decision ensures that Commerce’s dumping calculations reflect the economic realities on the ground and that U.S. industries are entitled under the law. You can be assured that you will receive relief from any unjust importation,” said Department Store.
Russia was on the list of countries that the United States considers to be non-market economies, but was removed from the classification in 2002 after Russia pursued measures to liberalize its economy.
This list includes Russia’s allies Belarus, China, Vietnam, Armenia, Azerbaijan, Moldova, Uzbekistan, and other countries that were part of the former Soviet Union.
The Department of Commerce’s decisions were based on a number of criteria, including the foreign investment environment, currency convertibility, and government control of the means of production. “In its decision, Commerce has found extensive setbacks in these areas, particularly since the invasion of Ukraine,” said a Department of Commerce press release.
Dumping is the sale of goods by a foreign manufacturer at a price below the producer’s selling price in the domestic market or at a rate lower than the cost of production. This occurs when the governments of these countries subsidize production and provide financial support, such as loans, on terms that do not reflect market conditions.
Trade with the United States and Russia
The new classification will result in higher import tariffs on products of Russian origin. However, the impact is reportedly minor as imports from Russia have already been curtailed since Ukraine’s invasion.
In 2022, the United States imported $12.5 billion worth of Russian goods year-to-date through September. US imports from Russia in 2021 were her $29.7 billion, more than double her level this year, and US exports to Russia totaled $6.4 billion.
Petroleum and minerals, lime and cement were the main commodities from Russia, accounting for over 59% of total imports in 2021. Base metals, iron, steel and tools followed with 13.4% of his, followed by stone, glass, metal and pearls. accounted for 10 percent. Data show that last year, 7.9% of his total U.S. imports of oil and minerals, lime and cement came from Russia (pdf) from the Department of Commerce.
“The Putin administration should not have the privilege of designating a market economy. Ohio) said.
“The Russian government owns 70% of its economy and this is not a market economy. You can grab it.”
At Friday’s climate summit in Egypt, President Joe Biden called on Russia to stop “using energy as a weapon and holding the global economy hostage.”
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Naveen Athrappully is a news reporter covering business and world events for The Epoch Times.