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Russia

Russia proposed sanctions on US, targeting alcohol, visas and rocket engines - and hits Boeing stocks

The measures would affect the US and any other countries that join its sanctions on Russia - and given the Kremlin’s tight control over parliament, the bill is likely to be passed within days

PUBLISHED : Saturday, 14 April, 2018, 12:46am
UPDATED : Saturday, 14 April, 2018, 8:48am

Russia outlined a broad range of potential retaliatory moves against new US sanctions on Friday, including curbs on imports of American farm products and cooperation in nuclear energy and rocket engines.

The proposals, which also include a potential bar on US consulting and accounting firms from working with state-owned companies and limits on imports of alcohol, will be discussed next week in the State Duma, Russia’s lower house of parliament. 

They also envision restrictions on visas for US specialists working in Russia. Presidential orders would be required to impose specific measures.

The measures would affect the US and any other countries that join its sanctions on Russia.

Given the Kremlin’s tight control over parliament, the bill is likely to be passed within days. 

US sanctions targeting Russian businessmen, companies and officials imposed a week ago sent Russian markets into a tailspin and brought about promises of retaliation from the Kremlin.

Given that Russia has little economic leverage over the US, officials said it could use an asymmetrical response as it has in the past to counter anti-Russian measures, as when it banned Americans from adopting its children or cut off student-exchange programmes.

“During discussions of the unfriendly actions against our country, we talked about the need to respond to the boorish behaviour by the US and its creating obstacles to Russian business,” Duma Speaker Vyacheslav Volodin said on Friday, according to Tass news agency.

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Spokesman Dmitry Peskov said the Kremlin would need some time to study the proposal but noted that no steps would be taken that would harm Russian interests. He declined to comment on specific items. The US is Russia’s fourth-largest trading partner. 

Imports from America totalled US$12.7 billion last year, according to International Monetary Fund data, with cars, pharmaceuticals and medical equipment among the top items. Exports to the US were US$17 billion.

Shares of Boeing dropped 2.3 per cent on Friday amid the news. Boeing said it is studying the possible impact of the “anti-American” legislation proposal on its business.

The draft law, which includes potential curbs on buying Russia’s goods and equipment with rare-earth metals, “will create significant problems because those are strategic materials”, Interfax news service reported, citing a lawmaker Evgeny Serebrennikov.

A legislator from the upper house, Sergei Ryabukhin, was quoted by the official RIA Novosti news agency as saying the law would also ban shipments of titanium to Boeing Co., which relies heavily on Russia, the largest producer of the metal. 

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But Ryabukhin said titanium would be covered under a clause limiting sales of rare-earth metals, which do not include the super-light material. He did not respond to a request for comment.

VSMPO-Avisma, Russia’s titanium monopoly, warned in a statement that any ban in shipments would do lasting damage to its position on global markets, RIA reported.