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16 Aug, 2021 15:01

US looks to revoke Russia’s status as market economy

US looks to revoke Russia’s status as market economy

The US Department of Commerce has initiated a probe to check whether Russia is operating as a non-market economy over claims the country subsidizes goods entering the US.

The complaint was reportedly submitted by CF Industries and its subsidiaries at the end of June. According to the claim, Russian exports were underpriced by more than 430%.

The Illinois-based manufacturer of agricultural fertilizers alleges that producers from both Russia and Trinidad and Tobago were selling illegally subsidized urea ammonium nitrate solutions (UAN) to the US at unfairly low prices. 

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Some Russian fertilizers are “being, or are likely to be, sold in the United States at less than fair value within the meaning of section 731 of the Act, and that such imports are materially injuring and threaten to injure an industry in the United States,” a statement published in the US government’s Federal Register reads.

Russia was awarded the status of market economy in 2002 after international recognition of the country’s economic and political transformation during the 1990s.

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The Department of Commerce is planning to look at a wide range of factors to assess if Russia should maintain the status of a market economy, including the convertibility of the Russian ruble, government ownership of companies, labor laws and wage settlements, state control over the allocation of resources as well as the status and role of foreign investment and corporations in Russia.

Last year, exports of Russian goods to the US amounted to $24 billion with the bulk of the sales made up of industrial products and hydrocarbons.

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