“Our assessment is U.S. exports to Russia could double within five years of WTO accession,” said Aslund. “It is ridiculously small now.”
U.S. exports of goods and services to Russia was about $11 billion in 2011, he said, but could double to $22 billion by 2017 if Russia joins the WTO and the United States normalizes trade relations.
Failure to grant normalized relations would allow Russia to restrict U.S. exports. Here, Russia is still subject to U.S. trade restrictions dating back to 1974, the Jackson-Vanick Amendment. Although it’s waived annually in order to allow two-way trade, it remains on the books and a big irritant.
It would disappear if Congress passed legislation granting Russia normalized trade status. However, in a sign that Congress may not be ready to decouple trade and human rights, the House Foreign Relations Committee on Thursday unanimously passed a bill to punish human rights abusers in Russia.
The measure was named after Sergei Magnitsky, a Russian lawyer for Hermitage Capital Management who died in a Russian jail in 2009, imprisoned after exposing alleged fraud by government officials.
The Magnitsky bill prohibits those involved in his death from getting visas to the United States, something the Obama administration says it’s already done. The bill also allows the State Department wide latitude to deny Russians accused of abuses access to the United States and its financial system.
Similar measures are in place for leaders of pariah states such as Iran and Myanmar. Some argue that it’s too blunt an instrument for Russia.
“The problem is Russia is simply not in the same basket” as those states, said Cory Welt, a professor and Russia expert at George Washington University’s Elliot School of International Affairs.
“It will make our ongoing dialogue with Russia more difficult and set us up for additional confrontations in the future,” said Bill Reinsch, president of the National Foreign Trade Council, a trade group for large U.S. multinational corporations.
“As usual with unilateral sanctions, it will be the business community that loses.”
Magnitsky bill proponents hope to attach it as an amendment to legislation that would normalize trade relations with Russia, something sure to anger Moscow. Preventing that is now the top international priority for the Chamber, which argues that U.S. jobs are at stake.
“It is absolutely a jobs issue,” said Wenk, senior director for international policy at the Chamber. “Russia needs a lot of stuff in terms of infrastructure, construction equipment. We sell a lot of stuff that they need. As far as we’re concerned, the question is whether it will be U.S. companies that are supplying those needs or European and Asian companies.”
U.S. poultry producers, most in southern states, have a lot at stake in the debate. During the late 1990s they enjoyed strong sales to Russia, hitting a high-water mark of more than 1 million metric tons in 2001. That fell to 215,000 metric tons last year, said the group, which backs normalized trade relations.
“It’s still an important market for us and will be for years to come,” said Toby Moore, vice president of the U.S. Poultry & Egg Export Council in Stone Mountain, Ga. “The difficulties with Russia have been legion … but there is still demand in Russia for commodity-grade, low-cost protein. And based on our intelligence, there will be for some years to come.”