ECO 561 Week 6

Topics: World Trade Organization, International trade, Free trade Pages: 31 (6656 words) Published: June 15, 2014


Russia Entering the World Trade Organization
ECO/561
January 6, 2014
Dr. J. Greg Gimba

Russia Entering the World Trade Organization
Executive Summary (Paul)
This paper examines the ascendancy and acceptance of Russia to the World Trade Organization (WTO). The paper looks at the challenging 18-year process from the time that Russia commenced negotiations to enter the WTO until its ultimate acceptance. Many issues regarding Russia needed to be resolved in the process. Some key issues needing resolution were market access, trade barriers, intellectual property protection, technical shortcomings, and a faulty legal system.

The paper further examines the major issues resolved. An analysis of the solutions and justifications follows. A look at the advantages and disadvantages for Russia and the WTO in forming this alliance is developed. A confirmation of the mutually beneficial relationship membership to the WTO provides is postulated. Members must at times compromise domestic protectionism in favor of a more attractive international trading policy with their international partners. Progress in innovation, technology, and an enforceable legal system that protects the parties involved leads to a positive outcome for the members.

Table of Contents

Overview
Russia commenced in negotiations to enter the World Trade Organization (WTO) in 1993 under the Boris Yelstin Regime as the world’s remaining major economy not in the WTO. Over 20 years of on and off meetings, and subsequent negotiations with embodied with skepticism, the turbulent path to Russia entering the WTO became imminent. The Prime Minister Vladimir Putin did little to negotiate for three years because he held the negations hostage stating that Russian would only join provided both Belarus and Kazakhstan were accepted. Many of the members believed that Putin viewed the WTO demands as politically motivated and annoying. The major setback is negotiations with Georgia because of a conflict that escalated into war in 2008, was not resolved until 2011 (Khvostunova, 2012). Analysts reviewing the potential economic impacts drew conclusions both positive and negative because analyst estimate Russia could gain approximately $50 billion a year with a economy growth of 3%. The World Bank reported that Russia might increase by 7.8% and the country’s GDP by 4.3% (Khvostunova, 2012). Analysts firmly believe that Russia should stimulate exports prior to joining the WTO because they are the 11th largest economy but Russia only accounts for 2% share of world trade. The majority of Russia’s export is oil, gas, and metals with few other products or services considered internationally competitive (Khvostunova, 2012). The remaining negative aspect is the WTO membership will expose the faults of the Russian economy through gaining access to overseas markets where Russia will have to provide open access to its market through tariff reductions, protection of intellectual property, accountability, transparency, and rule of law which today none of the aforementioned function efficiently. Problem Statement Current Situation

1. Agricultural Market: such as Tariff and quota commitments and restrictions, Export duties, General commitments on market access, Government Procurement Agreement 2. Trade in Services: Banking services (investments and financial issues), Russia is not committing to improve access to the market place for insurance services., and Telecommunication services 3. Intellectual Property Rights Issues: Socio-economic growth (feeble civil society, terrorism, alcoholism, and smoking), laws and regulations (trademark, patent, and copyright enforcement). 4. Sanitary and Phytosanitary, and Technical Barriers to Trade: Ensure transparency, predictable trading system, 18 years of negotiation, Custom Union between Russia, Kazakhstan, and Belarus. 5. Non-Liberated Technical and Telecommunication: Trade liberation and...

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Ralph, Tahlia (2012, August). http://www.globalpost.com/dispatch/news/business/global-
economy/120822/russia-joins-the-wto-after-18-years-negotiations
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Selivanova, J. (2004). World trade organization rules and energy pricing: Russia 's case. Journal
of World Trade, 38(4), 559-602
Tarr, D. G. (2007). Russian WTO accession: Achievments, Impacts, Challenges. Retrieved December 15, 2013, from OECD Organization: http://www.oecd.org/trade/gft/40747249.pdf
The Free Dictionary
The Ministry of Foreign Affairs of the Russian Federation. (2013, February). Concept of the foreign policy of the Russian Federation. Retrieved from http://www.mid.ru/brp_4.nsf/0/76389FEC168189ED44257B2E0039B16D
The New York Times
V, K. V., Y, A. A., & Y, S. I. (2013). Investment and innovation state support of agriculture in Russia as a condition of WTO. China - USA Business Review, 12(7) Retrieved from http://search.proquest.com/docview/1466546754?accountid=458
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World Trade Organization. (2014). How to become a member of the WTO. Retrieved January 2, 2014, from World Trade Organization: http://www.wto.org/english/thewto_e/acc_e/acces_e.htm
Bibliography
Anderson and Van Wincoop, (2003), James E. Anderson, Eric Van Wincoop Gravity with
gravitas: A solution to the border puzzle American Economic Review, 93 (1) (2003), pp
Craig, J. (2013, September 7). EU Ready to Sue Russia in Frist WTO Dispute. Retrieved November 23, 2013, from RIANOVOSTI: http://en.ria.ru/business/20130709/182141456/EU-Ready-to-Sue-Russia-in-First-WTO-Dispute.html
EIU ViewsWire (2013, May)
Interfax, . (2013, April). Court for intellectual rights created in Russia. Interfax : Russia & CIS General Newswire, (24), . Retrieved from http://search.proquest.com.ezproxy.apollolibrary.com/docview/1345425701
Interfax,
International Forest Industries. (2011, March). Update on Russian log export tax. Retrieved from http://www.internationalforestindustries.com/2011/03/17/update-on-russian-log-export-tax/
International Property Watch
Jones, K. (2009). The political economy of WTO accession: The unfinished business of universal membership. World Trade Review, 8(2), 279-314. doi:http://dx.doi.org/10.1017/S1474745609004261
Khvostunova, O
Ralph, Tahlia (2012, August). http://www.globalpost.com/dispatch/news/business/global-
economy/120822/russia-joins-the-wto-after-18-years-negotiations
Russian-European Chamber of Commerce. (2010). Legal protection of intellectual property. Retrieved from http://www.ruscham.com/en/rossinfo/db/15.html
Schewe, C
Selivanova, J. (2004). World trade organization rules and energy pricing: Russia 's case. Journal
of World Trade, 38(4), 559-602
Tarr, D. G. (2007). Russian WTO accession: Achievments, Impacts, Challenges. Retrieved December 15, 2013, from OECD Organization: http://www.oecd.org/trade/gft/40747249.pdf
The Free Dictionary
The Ministry of Foreign Affairs of the Russian Federation. (2013, February). Concept of the foreign policy of the Russian Federation. Retrieved from http://www.mid.ru/brp_4.nsf/0/76389FEC168189ED44257B2E0039B16D
The New York Times
V, K. V., Y, A. A., & Y, S. I. (2013). Investment and innovation state support of agriculture in Russia as a condition of WTO. China - USA Business Review, 12(7) Retrieved from http://search.proquest.com/docview/1466546754?accountid=458
Victoria, B.C
World Trade Organization. (2014). How to become a member of the WTO. Retrieved January 2, 2014, from World Trade Organization: http://www.wto.org/english/thewto_e/acc_e/acces_e.htm
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