Russia joined the WTO: pros and cons. When Russia joined the WTO (date, year)?

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2018-03-27 07:24:15

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WTO – is an international institution which acts as the successor to the General agreement on tariffs and trade (GATT). The latter was signed in 1947. It was assumed that it is temporary and will soon be replaced by a full organization. However, the GATT was the main agreement regulating foreign trade for nearly 50 years. The Soviet Union wanted to join him, but he do not give, therefore, the domestic history of interaction with this structure starts since the moment when Russia joined the WTO. This issue is the focus of our article. Also, it will be analysed the consequences of the fact that Russia joined the WTO, the pros and cons of this decision. We consider the process, conditions and purpose of the accession to the world trade organization, challenging issues for the Russian Federation.

when Russia joined the WTO

Did Russia in the WTO?

Russia is the legal successor of the USSR. If we are talking about when Russia joined the WTO, it is important to understand that this Institute started functioning only in 1995. The new organization was to monitor a much wider range of issues. The Union filed a formal application for observer status in the Uruguay round in 1986 with the aim of further accession to the General agreement on tariffs and trade. However, the US rejected it. The reason was the planned economy of the Soviet Union, which was not compatible with the notion of free trade. The Soviet Union received observer status in 1990. After independence, Russia has applied for accession to GATT. Soon, the General agreement was converted into a full-fledged organization. However, direct entry of Russia into the system of GATT/WTO it took almost 20 years. Too many issues require approvals.

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The Process of WTO accession

Russia as an independent state at the beginning of the accession to the world trade organization in 1993. Since that time, began a comparison and trade-political regime of the country with WTO standards. Then started bilateral negotiations, when Russia made its initial proposals for the level of agricultural support and market access. These two questions formed the basis of the negotiations up to ratification of the agreements in 2012. In 2006, in the Asian-Pacific forum, the United States and Russia signed the Protocol of Russia's accession to the WTO. However, the global financial crisis, and the negotiations on the implementation of further stages of obtaining membership in the organization was postponed. His role was played by the conflict with Georgia over Abkhazia and South Ossetia. The agreement with this country was the last stage on the path to accession of Russia to the WTO. He was signed in 2011 in Switzerland.

 Russia joined the WTO in year

Customs Union

Considering the question when Russia joined the WTO, it is important to understand that since January 2010, the Russian Federation wanted to participate in the process of accession to the Customs Union. About the same time Vladimir Putin made a statement at the meeting of the EurAsEC Council in June 2009. The customs Union includes, in addition to Russia, Belarus and Kazakhstan. It was formed in October 2007. WTO members can be not only the country but also the integrative enterprises. However, the leadership of the world trade organization immediately warned the Russian authorities that such a requirement would significantly slow the process of obtaining membership. In October 2009, Russia expressed a statement about whether the resumption of bilateral negotiations. Kazakhstan joined the world trade organization in 2015, while Belarus is still not a member of this international institution.

When Russia joined the WTO: the date, year

The Resumption of bilateral negotiations has significantly streamlined the process of joining the world trade organization for Russia. By December 2010, all issues were resolved. At the Brussels summit was signed a Memorandum. 22 Aug 2012 – this is the date when Russia joined the WTO. The date was marked by the ratification of the Protocol on the accession of the Russian Federation, signed on December 16, 2011, and the entry into force of the relevant regulatory act.

in what year Russia joined the WTO

Conditions of entry

Procedure of joining the WTO is quite complex. It consists of several stages and takes a minimum of 5-7 years. First, the state submits the application for membership. After that there is consideration of the trade-political regime of the country at the level of special working groups. In the second stage, the negotiations and consultations on the conditions of membership of the applicant in the WTO. They can join any interested country. First and foremost, the negotiations concern market access of the state and the timing of the introduction of changes. The conditions of accession shall be formalized by the following documents:

  • The Report of the working group. It sets out a whole list of rights and obligations that were taken on by the country.
  • A List of tariff concessions in the commodity field and allowed the possibility of subsidizing the agrarian sector.
  • A List of specific commitments in services.
  • List of exemptions from most-favored-nation.
  • Legal agreements at the bilateral and multilateral level.
  • The Protocol of accession.

The last stage is the ratification of the package of documents that was agreed in the framework of the special working groups. After that it becomes part of national law of the applicant state and the candidate country becomes a member of the world trade organization.

did Russia in the WTO

Aims and objectives

When Russia joined the WTO in 2012, it did so through its economic development strategy. To date, the state can not build an effective national economy, not being a member of this organization. Russia pursued its accession to the WTO the following purposes:

  • Obtaining greater access to foreign markets for domestic products through the use of MFN, which is declared by this organization.
  • Creation of a favorable investment climate by bringing national legislation in line with international standards.
  • Improving the competitiveness of domestic products.
  • Expansion of opportunities for Russian entrepreneurs and investors abroad.
  • Obtaining the ability to influence the formation of international legislation in the sphere of trade, taking into account its own national interests.
  • Improving the country's image in the eyes of the world.

Such a long accession negotiations – a Testament to the desire to achieve the most favorable membership conditions for Russia.

when Russia joined the WTO date

Tariff changes

One of the main obstacles to Russia's membership in the WTO was the negotiation of a policy of access to its market for foreign goods. The weighted average import tariff was reduced. On the contrary, the quota of foreign participation in the insurance sector increased. After passing the transition period will be reduced import duties on household appliances, medicines, and medical equipment. In the framework of WTO accession was concluded 57 bilateral agreements on access to domestic market and 30 – services.

Farm issues

Besides the discussion of the tariff concessions, the negotiations occupied an important place in the protection of the agricultural sector. Russia has sought to reduce the amount of subsidies to be reduced. Customs duties on agricultural products have become 11,275% instead 15,178%. For certain commodity groups experienced a sharp decrease by 10-15%. After Russia joined the WTO a year, when I started to subside the global financial crisis, the domestic agricultural sector has faced much stiffer competition in the domestic and foreign markets.

when Russia joined the WTO date year

Consequences for the Russian Federation

Today, there are many monographs and articles on the assessment of Russia's membership in the world trade organization. Most experts point to a positive impact on the economy. So what year Russia joined the WTO? In 2012. What changed? The accession took 18 years of hard work. This process has required much more time than anticipated. Therefore, a positive effect can emerge only in the distant future. As predicted by most experts, in the short term much more losses in connection with the WTO membership than actual achievements. However, the strategic benefits are worth some tactical defeats. Thus, accession to WTO – that is certainly a positive step, without which further development would be impossible.

Russia joined the WTO in 2012

The advantages and disadvantages of membership

After Russia joined the WTO in 2012, legal scholars and economists do not get tired to publish all new articles with analysis of problems and prospects associated with this event. Can be divided into three opinions:

  1. Neutral. For example, Professor Alexander Portansky believes that WTO accession does not bring neither good nor harm.
  2. Critical. Analyst Alexei Kozlov notes that the accession to the WTO gives Russia no obvious benefits in the short term. However, this event is a benefit for the other members of the organization. Prospects in the long term for Russia Kozlov considers.
  3. Negative. Chief economist of the Russian branch of Deutsche Bank Yaroslav Lisovik believes that joining the WTO may have a negative impact on the economy, especially in manufacturing industry, due to the reduction of import duties.

But most experts agree that the benefits for Russia from membership in the world trade organization will appear with the competent domestic and foreign policy only in the long term.


Article in other languages:

BE: https://tostpost.com/be/nav-ny-gramadstva/24833-ras-ya-stup-la-sga-plyusy-m-nusy-kal-ras-ya-stup-la-sga-data-god.html

DE: https://tostpost.com/de/news-und-gesellschaft/24852-russland-der-wto-beitritt-vor-und-nachteile-wenn-russland-mitglied-der.html

ES: https://tostpost.com/es/noticias-y-sociedad/24877-rusia-entr-en-la-omc-los-pros-y-los-contras-cuando-rusia-entr-en-la-om.html

KK: https://tostpost.com/kk/zha-aly-tar-o-am/24818-resey-k-rd-ds-arty-shyly-tary-men-kemsh-l-kter-kezde-resey-k-rd-ds-k-n.html

PL: https://tostpost.com/pl/aktualno-ci-i-spo-ecze-stwo/24748-rosja-wesz-a-do-wto-plusy-i-minusy-gdy-rosja-wesz-a-do-wto-data-rok.html

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TR: https://tostpost.com/tr/haber-ve-toplum/24821-rusya-dt-kat-ld-art-lar-ve-eksileri-vard-r-rusya-dt-kat-ld-tarih-y-l.html

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Alin Trodden - author of the article, editor
"Hi, I'm Alin Trodden. I write texts, read books, and look for impressions. And I'm not bad at telling you about it. I am always happy to participate in interesting projects."

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