USA OKs Russia’s entry into WTO
U.S. agreed on terms for Russia’s entry into the WTO (World Trade Organization) as U.S. and Russian trade negotiators reached agreement last Friday. A formal bilateral agreement is expected to be signed this week in Hanoi, where U.S. President Bush and Russian President Putin will be attending the annual APEC (Asia-Pacific Economic Cooperation) summit meeting to be held in Hanoi on the weekend of November 18-19. Last Friday’s news on progress in U.S.-Russia WTO deal became something of a sensation. Up until a crucial step forward made last week, the negotiations had stumbled along its course with enormous difficulties. Some experts argued that Russia would rather slam the door and exit the negotiations than cut a deal with the intractable Americans. It took Russia 13 years to get to the threshold of the WTO. Russia has negotiated with the U.S. for 8 out of those 13 years.
No details of the deal were immediately available. “The deal between Russia and the U.S. is well-balanced. As regards all major issues, a compromise was at last arrived at,” said Russian Economics Minister German Gref. Russia’s chief WTO negotiator Maxim Medvedkov was confident that Russia would benefit from its agreement with the U.S. “We’ve held talks with the U.S. for eight years. We had, without doubt, lots of problems to tackle during those eight years. Finally, we’ve reached an agreement that would benefit both Russia and the United States. The negotiations were pretty tough yet the results are fair and beneficial for Russia,” stressed Medvedkov.
According to Gref, the compromises were made in the areas relating to U.S. access to Russia’s banking sectors and sales of American agricultural products to Russia. The sides are still to sign an agreement under which Russia would strengthen its enforcement of intellectual property rights and copyright laws. Along with the protocol on the completion of talks, the agreement is planned to be signed during the Hanoi summit, said Gref.
About four months ago, U.S. and Russia appeared on the verge of an agreement. But it failed to materialize right before the July G8 summit in St. Petersburg. The issue of food safety rules for U.S. meat imports to Russia became a stumbling block that put the signing of a pact on hold. The sides set a new goal to wrap up talks by the end of October. One month later, Russian Economics Minister threatened that Russia would repeal Russia-U.S. meat trade agreement if the talks failed to conclude on time. Under the terms of the above agreement, U.S. poultry imports top the Russian market.
According to information obtained by Vremya Novostei, the two sides managed to cut a deal late October. Russian Economics Minister Gref and U.S. Trade Representative Susan Schwab initialed the document. The shook hands with each other and advised Vladimir Putin and George Bush that the agreement was ready for signing once necessary formal arrangements were in place. It is noteworthy that U.S. President Bush found time to discuss the details of the deal with Schwab despite his tough schedule during the midterm congressional election campaign. President Bush was reported to have been pleased with the negotiations that seemed to suit the interests of both sides.
However, the deal saga suffered another turn as Moscow raised more questions about U.S. poultry imports on November 1. Sergei Dankvert, head of Russian federal service for food safety and a member of the Russian WTO team, had earlier agreed on the terms relating to poultry imports yet officials at the Russian Ministry of Agriculture had some second thoughts. According to a source cited by Vremya Novostei, it took the negotiators two weeks to finalize the agreement.
Analysts are trying to guess what commitments Moscow may have made in exchange for its deal with the U.S. on the WTO. Striking a deal on the basis of quid pro quo seems to be quite logical since similar accords often form part of a political bargain. The agreement reached between Russia and the European Union in May 2004 is one of the examples. Russian President Putin promised to speed up Moscow’s ratification of the Kyoto Protocol in exchange for a Russia-UE deal. Back then Russia took four months to make the promise a reality.
Some analysts say that a deal on the WTO could persuade Russia to soften its opposition to punishing Iran for refusing to halt its nuclear enrichment program. The prospects seem unlikely to come true because Moscow’s influence on Tehran is quite limited, by and large. Russia will simply lose its diplomatic leverage with Iran by taking a tougher stance on the issue.
The success of the negotiations rests on two pillars that seemed rather shaky at the beginning. Firstly, Russia’s consistently firm position (tactical maneuverings aside) during the talks played out well. Secondly, Washington and George W. Bush in particular proved to be really interested in pushing Russia’s WTO bid through. “At some point we were under the impression that every new condition put forth by the Americans was just a way for them to make the talks last forever,” said a high-ranking Russian official. “More importantly, Putin started thinking likewise. Needless to say, such an attitude couldn’t help much our negotiators. However, I believe Washington finally got a signal sent by our political leadership which clearly indicated that we might as well call it quits if no things remained the same,” added the official.