While reading about the crisis in Crimea I came across this tidbit that surprised me.
U.S. and EU marshal economic tools to punish RussiaOK WHY is the U.S. Trade Representative negotiating trade and investment deals with a country that conceivably could be facing sanctions on trade and investment? I thought we only were making trade agreements with reliable partners, not with countries who's first resort in a foreign dispute could be a military invasion.
BY WARREN STROBEL, ARSHAD MOHAMMED AND ANNA YUKHANANOV
- Cut back on U.S.-Russian bilateral trade. Trade in goods between the two countries was worth $38.12 billion in 2013 and U.S. firms have $14 billion in direct investment in Russia.
Russia and the United States had started talking about a bilateral investment treaty, but a planned visit by U.S. trade officials to discuss that treaty has now been scrapped.
"We have suspended upcoming bilateral trade and investment engagement with the government of Russia that were part of a move toward deeper commercial and trade ties," a spokesman for the Office of the U.S. Trade Representative said on Monday.
Russia needs investment to keep its economy humming -- it has suffered from about $60 billion in net capital outflows annually in the last two years.
The Russian central bank already has raised interest rates to defend the ruble, threatening to push the economy into recession, by some economists' reckoning.
U.S. oil major ExxonMobil and aircraft maker Boeing are two companies with strong links to Russia and involved in joint ventures with Russian partners.
This is appealing. We as a country need to become more circumspect about who we are making these bi-lateral trade agreements with. Can you imagine where we'd be if this crisis had erupted after we had already entered into trade and investment treaties with Putin's Russia? I shudder to think.