Russia will complete WTO accession talks in autumn 2005

Monday, August 15, 2022

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Russia will complete WTO accession talks in autumn 2005, Economic Development Minister German Gref said at the Government Hour in the Federation Council. "We plan to complete talks on accession to commodity markets by the middle of the year and negotiations on systemic issues in autumn 2005," said the minister. "The completion of the talks will largely depend on the political will of the US leadership," Mr. Gref added, noting that the US is the largest partner with whom Russia has not finished accession talks yet. "We will not speed up the talks but neither will be draw them out," the minister said, recalling that each year of procrastination costs Russia $2 billion (the value of discrimination and protection measures applied by other countries with regard to Russian commodities). Mr. Gref believes that the WTO accession "would not ruin or boost" the Russian economy but will greatly increase its investment attractiveness, as it happened in China after it became a WTO member. The minister stressed that Russia would not go back on its stand on energy issues and limitations on the services market at the WTO talks, saying that tough negotiations with trade partners in the WTO are underway on these issues. He recalled that the EU wanted Russia to lift export duties on energy resources and increase domestic prices of gas. "We convinced our trade partners that we cannot assume such obligations," Mr. Gref said. The protocol on the completion of talks with the EU on Russia's WTO accession seals only the pledge to keep up the gas prices dynamics as stipulated in its energy strategy. Moscow will keep the limitations on the market of banking services, in particular, the ban on opening branches of foreign banks in Russia. The minister explained the bank by the fact that foreign branches escape full control of Russian regulating agencies. He assured the members of the upper house that Russia would preservethe export duties on energy resources, as well as export duties on ferrous and non-ferrous scrap (for the transition period). But import duties will be gradually lowered, said Mr. Gref, within 3-7 years of the transition period. The reduction of the average weighted tariff, which is 12.9% now, will not be substantial - merely 1.4%. German Gref also said that upon becoming a WTO member Russia would open its labour market only to skilled personnel. "The labour market will be opened only to the so-called key personnel - managers (including top managers) and specialists with unique skills," the minister said. He believes that agriculture will benefit the most from Russia's accession to the WTO, because Russia will gain the ability to influence the EU whose countries provide major state assistance to their agricultural producers. "We will never attain their level of state assistance, but we can force them to reduce it," he said. After becoming a WTO member, Russia will have the right to introduce protective measures against agricultural imports from the EU or to demand compensation for EU's food deliveries. "We will get major tools for protecting our agriculture," German Gref said. He reminded members of the upper house that state assistance to agriculture in Russia amounted to $2.5-3 billion now. After becoming a WTO member, Russia will keep the right to increase it to $13 billion. "It is not the WTO, it is the capabilities of the state that put the limit [on our agriculture]." Mr. Gref noted that Russia would keep the meat import quota until 2009 because its WTO partners agreed to this, though meat quotas have "different consequences." "It is clear that the growth of prices of meat products is connected to quotas, but the latter spurred on production, above all o the poultry meat," the minister said. According to him, meat production in Russia increased by 25% in the past two years. "Regrettably, there is no growth in beef andpork production," he admitted, noting that importers do not even supply the established quota.

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