Tuesday 21 October 2014
 
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Russia wins approval to join WTO

Geneva, December 17, 2011

Russia has won admission to the World Trade Organisation (WTO) after 18 years of negotiations, finally gaining full integration into the global economy two decades after the Soviet Union collapsed.

The WTO's 153 members gave their second and final approval for Russia's membership bid, ushering in the last major economy outside the trade club.

The Russian parliament will have until June 15 to ratify the accord and bring it into force.

"This is clearly a historic moment for the Russian Federation and for the rule-based multilateral system after an 18-year marathon," said WTO director-general Pascal Lamy.

Russia's $1.9 trillion economy was the largest outside the WTO, and accession will help reduce the dependence on energy exports that left it badly exposed to the oil price collapse of 2008.

Accession by Russia, with the second-largest nuclear arsenal after that of the United States, into a rules-based club should limit the danger of any repeat of regional conflicts like its 2008 war with Georgia.

Trade conflicts have repeatedly exacerbated tensions between Moscow and the South Caucasus state and the WTO could offer a forum to address disputes before they escalate.

Describing the accession as a win-win for both the WTO and Russia, Lamy said it "accords the quality WTO label" on Russia and with the membership the trade body "will cover 97 per cent of world trade."

"We are rapidly approaching universality in the coverage of global trade," said the director-general.

Making a reference to the storm over Geneva, Russian First Deputy Prime Minister Igor Shuvalov welcomed the accession saying: "The storm is a sign of a wind of change - change for the better."

Russia applied to join the trade body in 1993 but talks dragged on and its brief war with Georgia in 2008 further delayed its application.

No other country has had to bargain so long before being granted entry. China was the previous record holder with 15 years of negotiations for membership. Moscow cleared its last hurdle for WTO accession when it finally clinched in November a deal with last hold-out Georgia.

In all, Russia sealed 30 bilateral agreements on market access for services and 57 on access for goods in order to secure the green light from other WTO states.

For the overall package, Moscow agreed to cut its tariff ceiling from the 2011 average of 10 per cent for all products to 7.8 per cent.

The average tariff ceiling for agricultural products is cut to 10.8 per cent from 13.2 per cent currently, with manufactured goods at 7.3 per cent, down from 9.5 per cent.

Russia also agreed to limit farm subsidies to $9 billion in 2012 and to gradually reduce them to $4.4 billion by 2018.-Reuters




Tags: Russia | WTO | approval |

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