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 Rapped by critics for not taking a harsh enough line with Russia,
the White House is mulling its next moves.
"We are prepared to impose further costs on Russia for its violation
of Ukrainian sovereignty and territorial integrity," White House
spokesman Jay Carney said on Wednesday.
Russia's deputy foreign minister, meanwhile, promised "a broad range
of responsive measures" that "won't go unnoticed in Washington."
At stake from the worst East-West crisis since the Cold War is goods
trade between the two countries that was worth about $38 billion in
2013.
Machinery, vehicles and aircraft lead the list of U.S. exports to
Russia, which in turn exports crude oil, iron, steel and platinum to
the United States, among other things.
U.S. companies also have $14 billion in direct investment in Russia,
with about half that amount coming the other way, and mutual fund
and hedge fund investments in Russian companies, many of them
state-owned, is much higher.
Oil major ExxonMobil and aircraft maker Boeing are two companies
with strong links to Russia and involved in joint ventures with
Russian partners.
Other U.S. companies active in Russia include Chevron Corp, General
Electric Co, Caterpillar Inc, John Deere, Ford Motor Co, General
Motors Co, PepsiCo Inc, Mars, Cargill Inc, and Kraft Foods.
Randall Stephenson, chairman of the Business Roundtable and chief
executive officer of AT&T, told reporters this week that the Ukraine
crisis was "obviously an area of concern" to members.
"Anybody doing business in Europe is watching the situation very,
very closely," Stephenson said.
The Roundtable is an association of chief executives of major U.S.
corporations, from the defense industry and consumer manufacturers
to the healthcare and technology sectors, many of which have global
footprints.
Dozens of the group's members had a chance to raise their concerns
in meetings with top administration officials on Wednesday, at an
event featuring Defense Secretary Chuck Hagel and Trade
Representative Michael Froman.
But a Pentagon spokesman said the Ukraine crisis was not a major
talking point, either in the secretary's remarks or in the questions
and answers afterward.
Hagel cited Western tensions with Russia as an example of the kind
of security concerns the United States may have to address
unexpectedly in the future, said Rear Admiral John Kirby.
CURTAILED TALKS ON TRADE TIES
The Obama administration has curtailed contacts with Russia since
the Ukraine crisis blew up, and Froman this month halted his
agency's talks on deeper trade and investment ties with Moscow.
The United States and Russia had started talking about a bilateral
investment treaty, and Russian Economy Minister Alexei Ulyukayev
said in February the next step would be a meeting of trade experts.
The promise of more sanctions has generated some political posturing
as well.
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On Wednesday, five U.S. lawmakers, mostly from districts that are
home to major U.S. defense contractors, urged Hagel to cut off
taxpayer dollars to Rosoboronexport, the Russian state-arms dealer.
The U.S. Defense Department has a contract to buy Russian-made Mi-17
helicopters from the company.
Some critics said the U.S. sanctions so far are too weak to deter
Russian President Vladimir Putin, while others expressed concern
about potential economic impact the sanctions and expected
retaliation by Moscow could have on markets and trade.
The U.S. Chamber of Commerce, another Washington-based business
group, called for close cooperation with Europe, whose annual trade
with Russia is about 15 times larger than that of the United States.
"A go-it-alone approach by the United States could be both
economically damaging and ineffective in accomplishing its goals,"
said the chamber's vice president, Myron Brilliant, who oversees
international affairs for the group.
Russia joined the World Trade Organization in 2012 and so far has
had no trade disputes with the United States, although U.S. trade
officials in December raised concerns over vehicle fees, copyrights
and a meat additive ban.
Risk of further volatility in Russia has U.S. securities regulators
on alert as well.
The Securities and Exchange Commission has contacted public funds
with investments in Russia to make sure they are properly managing
risks and disclosing those holdings to investors, Reuters reported.
Regulators are focused on whether funds are being open with
investors, and whether the funds are preparing about how they might
respond to different scenarios or outcomes.
Russia's currency, the ruble, hit a record low this week, and a
ruble-denominated index of Russian stocks is down 12.3 percent for
2014 so far. The dollar-denominated RTS index is down 20 percent.
(Additional reporting by Sarah N. Lynch, Susan Heavey and Anna
Yukhananov in Washington, Lewis Krauskopf in New York and Thomas
Grove in Moscow; editing by Ros Krasny, Bernadette Baum, David
Storey, Alden Bentley and Mohammad Zargham)
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