Russia is months from completing WTO talks-Kudrin

By Daniel Bases

WASHINGTON, April 11 (Reuters) - Russia's progress toward joining the World Trade Organization has been slower than it hoped, and multi and bilateral talks will take months to complete, Finance Minister Alexei Kudrin said on Friday.

Kudrin met with several U.S. officials, including U.S. Trade Representative Susan Schwab, while in Washington for the annual spring meetings of the International Monetary Fund and World Bank.

"Our roadmap that we basically agreed upon in Davos, with the EU and the US is being implemented maybe a bit slower than we hoped, but all the major items are in the process of being worked on," Kudrin, speaking at a press conference, said through an interpreter.

"We hope in a few months to conclude the multilateral and bilateral talks," he said, but would not elaborate on when the actual deal might be reached or how much closer they are to agreeing on such issues as timber tariffs.

One senior Western diplomat told Reuters on April 4 that political paralysis has delayed the process as Russia waits for President-elect Dmitry Medvedev to replace outgoing president Vladimir Putin on May 7.

Russia is the last major economy outside of the WTO, which sets rules for global trade practices.

IMF REFORMS

Kudrin, whose comments covered a broad range of topics, expressed concerns about the IMF's proposed new voting system, saying it does not go far enough in redistributing voting power to emerging economies.

Russia has initially opposed the new system, which will be voted upon by all 185 member countries by the end of April. It is also one of the countries that would see its influence reduced, albeit in a minuscule way.

Overall, the changes in voting shares amount to an aggregate shift of 5.4 percentage points to under-represented countries. Still, the actual shift from industrial countries to emerging ones was a small 2.7 percentage points.

"It is a very cosmetic change," he said, stressing he personally has not taken a final decision.

"I think the goal of the quota reform was not reached. When taking a final decision we will proceed from the viewpoint that we are not satisfied," he said.

A change in the IMF's voting system would be the most significant structural change to the IMF in 60 years.

BUDGET AUCTIONS

On the domestic front, Kudrin said he expects Russia will hold its first budget auction among commercial banks, meant to help boost the amount of cash in the country's financial system, possibly April 16 or 17.

These auctions will allow the government to place unspent budget funds with the banks and help to ease the global credit crunch that has dried up access to cash for Russia's non-financial business sector.

"As for the volumes, this decision will be taken at the very last moment," Kudrin said.

He added that on April 12, Russian newspaper Rossiiskaya Gazeta is set to publish "all the government regulatory acts that are needed for these auctions," he said.

Russia's economy is expected to grow over 7 percent this year, he said.

Russia has kept the federal budget cash in the central bank since 2002 -- a measure which improved control over spending practices and helped sterilize petrodollar inflows.

He also weighed in on oil prices, saying prices above $100 a barrel are not sustainable.

"It is speculative and will not last long.... The demand for oil exceeds the demand related to the consumption of oil and it has become more of an investment commodity now. This overheats the market," he said.