After 18 years of negotiations, Russia joins the World Trade
Organisation (WTO) as its 156th member today. This accession is particularly
important for the world economy as Russia can now freely trade with 155 member
nations, based on multilateral rules and obligations for their mutual trade.
“…. WTO accession is a major step for Russia's further
integration into the world economy", said EU Trade Commissioner Karel De
Gucht. "It will facilitate investment and trade, help to accelerate the
modernisation of the Russian economy and offer plenty of business opportunities
for both Russian and European companies. I trust that Russia will meet the
international trading rules and standards to which it has committed."
The WTO accession will have a positive impact on the
conditions of trade and investment between Russia and the world. The
geographical position of Russia and the importance of its market in terms of
volume and growth make it a very important trading partner. As a consequence of
the WTO accession, Russia will amongst others lower its import duties, limit
its export duties, grant greater market access for WTO member nations services
providers and facilitate rules and procedures in many areas affecting bilateral
economic relations. Of particular importance will be regulations on customs
procedures, the use of health and sanitary measures, technical standards and the
protection of intellectual property.
Russia will be subject to WTO rules in all these areas,
including its monitoring and enforcement mechanisms. The EU, together with its
international partners, is in contact with Russia to ensure that it respects
these WTO commitments. Certain recently implemented or proposed legislation
seems to be at odds with Russia's commitments and would stand in the way of
other WTO members fully realising the benefits expected from Russia's WTO
accession. The EU is particularly concerned about the proposed new legislation
providing for a car recycling fee which could discriminate against imported
vehicles and hopes that this legislation will not be adopted.
Background
The economy of Russia is the ninth largest economy in the
world by nominal value and the sixth largest by purchasing power parity
(PPP).[1] Russia has an abundance of natural gas, oil, coal, and precious
metals. Russia has undergone significant changes since the collapse of the
Soviet Union, moving from a centrally planned economy to a more market-based
and globally integrated economy. Economic reforms in the 1990s privatized many
sectors of the industry and agriculture, with notable exceptions in the energy
and defence-related sectors. Nonetheless, the rapid privatization process,
including a much criticized "loans-for-shares" scheme that turned
over major state-owned firms to politically connected "oligarchs",
has left equity ownership highly concentrated. As of 2011, Russia's capital,
Moscow, now has the highest billionaire population of any city in the
world.
In late 2008 and early 2009, Russia experienced the first
recession after 10 years of experiencing a rising economy, until the stable
growth resumed in late 2009 and 2010. Despite the deep but brief recession, the
economy has not been as seriously affected by the global financial crisis,
compared to most of Europe, largely because of the integration of short-term
macroeconomic policies that helped the economy survive.
In 2011 Russia’s gross domestic product grew by 4.2 percent,
the world’s third highest growth rate among leading economies. The government
expects it to grow 3.7 percent in 2012. The
main changes related to the WTO accession of Russia concern market access
improvements for goods and services. The import duties for goods will decrease
from a current average of 10% to an average 7.8%. In some important sectors,
such as automotive, the import duty reductions are more significant (decreasing
from currently 30% to 25% upon accession and to 15% after 7 years).
Although, in the past Russia is interested in developing
economic relations with Africa, but has not done much on that front. Let’s hope
that the accession to WTO will encourage trade Interest of Russian Investors to
Africa’s vast natural reserves make the continent an increasingly attractive
investment destination for Russia’s energy and other natural resource
industries. On account of its strong economic growth, large external assets
(US$ 480 billion in foreign exchange reserves), increasing outward direct investment,
and politico-strategic ambitions.
