U.S. Exports To Russia Rise Despite Tensions, Minor Sanctions

There’s some evidence to the fact that U.S. sanctions against Russia for their part in the civil unrest in Ukraine has not hurt trade between the two countries.  The U.S. exported more good and services to Russia in May, the latest month for data, than any month this year.
That said, Russia and U.S. are only marginal trading partners. The U.S. sold $1.25 billion worth of exports in May, up from $1.03 billion in April and $1.01 billion in March when the sanctions were announced.

All of the sanctions are targeted towards a handful of Russian oligarchs, their privately held companies and a few politicians that are believed to be providing logistic or financial support to Russian separatists inside Ukraine.  The embattled nation has been fighting ethnic Russians since early March, when the Ukrainian peninsula of Crimea voted to secede and  join the Russian Federation on March 16. 

Barack Obama & Vladimir Putin at Putin’s dacha in 2009. Sanctions haven’t put much of a damper on U.S. trade with Russia. 

The U.S. actually has a small trade deficit with Russia of around $903 million, the lowest this year thanks to an increase in May trade by U.S. firms.  The country is basically on par to export the same amount of goods as it did in 2013. So far, U.S. companies sold $5.1 billion in exported good and services as of May compared to $4.5  billion in the same period of 2013, and $11.1 billion for the whole year.

Within the BRIC countries, Russia is dead last an American trading partner.  The U.S. exported $7.8 billion this  year to India, $17.3 billion to Brazil and $49.3 billion to China.   For its size, Russia is very much a closed market for the U.S.   American companies export as much as much to Turkey ($4.9 billion so far this year) as they do Russia, according to the U.S. Census Bureau’s Foreign Trade Division.

American companies would like more access to Russia, but this depends more on Moscow than it does on Washington.

The U.S. Chamber of Commerce and the National Association of Manufacturers launched a campaign last week warning Washington against adopting tougher sanctions against Russia, saying the actions would harm American manufacturers and cost American jobs. In April, Treasury said that harsher sanctions targeting specific sectors of the economy — including finance and energy — were on the table if Russia continued to back the separatists in Ukraine.  Despite the new government of Ukraine basically saying that Russian spies and other intelligence assets are behind the unrest in east Ukraine cities like Donetsk, the U.S. and its partners in Brussels have not issued any damaging sanctions since.

On the Independence Day holiday, Russian President Vladimir Putin waved a white flag and got in his beset star-spangled banner mood when he wished President Obama a Happy Fourth of July in an official statement today.  Ladened with the usual political rhetoric, Putin said Russia and the U.S. share a responsibility to protect global security and stability, and should cooperate more rather than disagree.

“Russia and the United States, being the powers with special responsibility to ensure global stability and security, should cooperate to benefit not only the interests of their people, but the whole world,” Putin said.

Putin expressed hope that relations between Moscow and Washington will develop despite the current difficulties associated with Ukraine.