Russia s WTO bid in doubt

August 31, 2008

, GENEVA, August 31 – Russia\’s longstanding aim of joining the World Trade Organisation has been thrown into doubt as the conflict with Georgia and tensions with the West threaten to reshape the geopolitical order.

Moscow has been knocking at the door of the Geneva-based body since 1993, just two years after the collapse of the Soviet Union and during the first flush of the country\’s embrace with capitalism.

Now it is the only major world trading power outside the bloc and has seen its former Soviet satellites such as Georgia and Ukraine steal a march and join the organisation in 2000 and 2008, respectively.

Diplomats speculate that the conflict with Georgia over the breakaway region of South Ossetia could sound the final death knell for any hopes of membership.

Even before this month\’s outbreak of hostilities, Georgia had voiced objections to Russian membership in 2006 after Moscow placed heavy restrictions on imports of Georgian goods such as wine and mineral water.

Not only does Georgia, as a WTO member, effectively hold a veto over Russia\’s admission, all such decisions must be unanimously agreed by all 153 member states, but Russia itself has hardened its attitude, with powerful Prime Minister Vladimir Putin questioning whether membership is even worth it at all.

"It turns out that we don\’t see or feel any pluses from membership and if there are some, we still carry a burden," Putin said on Monday.

Russia also signalled it would cut imports of pork and chicken meat, which were agreed three years ago as part of its negotiations to join the WTO, because it believes the deals to be unfair.

Kremlin ministers have also complained that they have been "cheated" because the negotiations have dragged on for so long.

"To put it simply, we have been cheated because a country really fulfilling its obligations should not have to wait so long to join the World Trade Organisation," Agriculture Minister Alexei Gordeyev said.

Nevertheless, Russian trade officials in Geneva were adamant that they still intend to join the organisation.
"We are not going to change our manner of negotiating," said Yuri Afanasiev, the chief trade negotiator at Russia\’s diplomatic mission to the United Nations in Geneva.

"Some of our partners might like to freeze the process but we want to carry on," he told AFP.

Even Putin said withdrawing from some agreements did not mean breaking off talks altogether.

"This doesn\’t mean we should renounce our strategic course towards the WTO but there should be some clarifications on this question … Elementary fairness should prevail," said Putin.

Whilst Russia remains outside the organisation, many member states such as the United States and EU have already signed bilateral trade deals.

The EU on Thursday urged Moscow to speed up the accession process but stressed that it still has objections of its own that must be overcome.

Talks with the European Union have been held up largely over a dispute over export duties on Russian wood, which is a major raw material for paper and wood products makers in Finland.

"Unless we see progress on that (issue) we cannot sign off on Russia\’s application for the WTO," said Peter Power, spokesman for EU trade Chief Peter Mandelson.

The United States warned meanwhile that Russia\’s recent actions, both militarily and on the trade front, risked jeopardising its integration into the international trading system.

"By its recent actions, \’Russia is putting its aspirations at risk\’," a US official said this week, citing quoting a statement by President George W. Bush that criticised Russia\’s military actions in Georgia.

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