G7 Considers Full Export Ban on Russia (Comprehensive)

Reviewing Positive Shift in Export Restrictions
Possible Exemptions for Pharmaceuticals and Agricultural Products
Russia Concerns Over Retaliatory Sanctions

The Group of Seven (G7) is considering a measure to ban all exports to Russia as part of efforts to strengthen sanctions against the country.

Kyodo News reported on the 21st, citing Japanese government officials, that the matter is still under discussion and may be subject to change.

The core of this measure lies in shifting the export sanctions against Russia from a negative list approach to a positive list approach.

Currently, Western countries including the G7 and the EU apply a negative list approach, allowing exports to Russia except for certain prohibited items. According to Bloomberg, the G7 countries are considering switching to a positive list approach, which assumes a total ban on exports to Russia and only lists items that are allowed.

The G7 Foreign Ministers' Meeting held on the 17th of this month in Karuizawa, Nagano Prefecture, Japan [EPA=Yonhap News]

G7 officials are discussing ways to have European Union (EU) member states join the sanctions ahead of the G7 summit scheduled for next month.

However, for the EU to participate in the sanctions, it must overcome the hurdle of unanimous agreement among its member states. Germany, Italy, and Poland are the largest exporters to Russia in Europe, and if the EU implements the sanctions, companies in these countries are expected to strongly oppose them.

If the G7 leaders agree on this measure, further agreements will be needed to determine which items will be exempt. However, multiple sources told Bloomberg that "medicines and agricultural products, including food, are likely to be exempted."

If the sanctions are implemented, Russia is expected to retaliate economically immediately. Previously, when the EU and G7 countries imposed a price cap on Russian crude oil, Russia retaliated by banning oil sales to those countries. Bloomberg noted that "the EU would be vulnerable to copper-related products if Russia retaliates economically."

Moreover, export sanctions against Russia could influence the strengthening of diplomatic relations between China and Russia. According to The Wall Street Journal (WSJ), as Russia suffered economic damage from Western sanctions, China exported semiconductors and dual-use civilian and military goods to Russia. The more Western countries tighten the noose on Russia, the greater the concern that economic cooperation between China and Russia will deepen further.