Exclusive: Russian WTO bid picks up momentum

GENEVA Tue Sep 21, 2010 2:38pm EDT

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GENEVA (Reuters) - Russia's bid to join the World Trade Organization picked up steam on Tuesday and the United States said there was new energy in the 17-year-old talks.

The comments suggest Washington is still keen to get Russia into the body that referees global trade as soon as practicable, despite a series of issues dogging bilateral trade ties.

"There's momentum in the process, a lot of energy on the part of Russia, a lot of interest on the part of many members," a U.S. official, who asked not be identified, told Reuters after a meeting of Russia's WTO accession working party.

President Barack Obama and Russian President Dmitry Medvedev said in June they had instructed their negotiators to resolve technical issues by the end of September to clear the way for Russia to join the WTO.

That deadline is certain to be missed, and Russian Prime Minister Vladimir Putin said on Tuesday that Russia would not be in the WTO this year, but Washington and Moscow are keen to push ahead in the coming months.

The accession working party will meet again on October 25 and December 6 and Russia, the biggest country still outside the WTO, is holding bilateral talks with a dozen WTO members this week.

The U.S. official said much technical work still remained to be done on Russia's accession bid.

The main practical difficulty in the negotiations is Russia's membership of a customs union with Belarus and Kazakhstan, which would make it difficult for Russia to join the WTO without the other two, whose own accession processes are much less advanced.

The WTO's 153 members want to know how Russia's participation in the customs union will affect the commitments it makes to opening up its markets to WTO members.

Tuesday's meeting was the first in over a year, after Putin threw the negotiations into disarray by announcing in June 2009 that Russia would join the WTO as part of the customs union.

Russia will also have to reach an understanding with Georgia, with which it went to war in 2008.

Like all WTO members, Georgia has an effective veto on new members. It argues that Russia's military presence in two breakaway regions disrupts its border customs arrangements.

TACKLING CONCERNS

A month after Obama and Medvedev's pledge, the United States warned that Russia must improve its efforts to stop piracy and counterfeiting of U.S. music, films and other goods in order to join the WTO.

Russia's chief WTO negotiator, Maxim Medvedkov, said Moscow was working with the United States to address its worries about Russia's intellectual property regime.

"We know about the concerns, we share many of their views," Medvedkov told Reuters.

Dealing with this would require legislative changes in Russia, and the government had to work with lawmakers, he said.

Russia is also importing U.S. poultry again, ending a ban imposed in January because of concerns about a chlorine rinse used in U.S. meat processing plants that shut down the biggest export market for U.S. chicken.

Medvedkov said Moscow was talking to the European Union about Russia's export duties on timber -- another obstacle to its membership of the WTO because Brussels argues the charges push up the prices of a key raw material for its Nordic paper and wood processing industries.

Medvedkov said some WTO members were complaining that Russia was becoming more protectionist in advance of joining the WTO.

For instance the European Union complained of higher Russian tariffs on pigs and cars and new export duties on copper and nickel, a participant in the meeting said.

But Medvedkov said Russia had never agreed to freeze its trade policies during the drawn-out negotiations, though once it entered the WTO it would stick to its commitments.

(Additional reporting by Darya Korsunskaya in St. Petersburg)

(Editing by Tim Pearce)

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