Let Russia Join the WTO

Here's how the White House can earn an easy win next week.

BY ANDERS ÅSLUND, C. FRED BERGSTEN | JUNE 18, 2010

On June 24, U.S. President Barack Obama will welcome his counterpart, Dmitry Medvedev, to the White House. If there's one thing that the two presidents must accomplish, on an issue that has fallen off most observers' radar screens amid all the nuclear diplomacy and talk of "resetting" relations between Washington and Moscow, it's Russia's accession to the World Trade Organization (WTO) -- a potential game changer for the country's economy and foreign policy.

After hitting a low with the Russia-Georgia war in August 2008, U.S.-Russia relations have rapidly improved. Two milestones are the strategic nuclear arms reduction treaty that was signed in April and the new U.N. Security Council resolution on stricter sanctions against Iran. The next step is to improve economic cooperation.

The WTO currently has 153 members, accounting for 96 percent of world trade. Russia, which accounts for 2 percent of global commerce, is the biggest country outside the organization. Having applied in 1993, it has waited for membership longer than any other country, though the United States has recognized Russia as a market economy since 2002 -- a status it does not accord to WTO member China.

It's true that Russia needs the WTO less than many other countries, since it largely exports commodities that enjoy free-market access in any case. Yet Russia's potential gains from WTO accession have been assessed at 3.3 percent of GDP a year, a major jump for the economy. The main benefits would arise from freer trade of services and foreign direct investment.

Russia has never been closer to WTO accession. The remaining hurdles are modest: sanitary rules for U.S. exports of chicken and pork, limits on future agricultural subsidies, rules for encryption, regulation of state-owned enterprises, and export tariffs for lumber. By and large, these issues can be settled bilaterally with the United States. If any query remains after the Obama-Medvedev summit, it can be concluded at the G8 and G20 summits in Toronto that follow on June 26-27. Russia is the only member of the G8 or G20 outside the WTO.

The real obstacle is the lack of mutual trust. Russian trade negotiators fear that the Americans will raise new concerns after they think they have settled all the outstanding issues. A year ago, American negotiators were thrown off balance by Prime Minister Vladimir Putin's assertion that Russia's customs union with Belarus and Kazakhstan had priority over its WTO accession, but Russia has now made clear that WTO entry comes first and should proceed on its own. Therefore, Russia's accession needs to be decided politically by the presidents, and the outstanding technicalities could then be sorted out in a few months.

Epsilon/Getty Images

 

C. Fred Bergsten is director and Anders Åslund a senior fellow of the Peterson Institute of International Economics.

CATHERINE A. FITZPATRICK

9:53 PM ET

June 24, 2010

A Test of Wills the U.S. Must Meet with Graduation, Not Repeat

As a human rights activist concerned about major human rights issues inside Russia (murder of human rights activists and journalists, suppression of free media, poor prison conditions, political cases like that of Mikhail Khodorkovsky and Platon Lebedev), I appreciate the value of linkage. Linkage isn't just malicious conditionality to thwart an enemy; Russia is not our enemy now but a partner on some projects which can't be trusted fully on everything. So linkage can still remain as a sober reckoning that without a basic foundation of human rights compliance, a country will not be a fair or reliable business or security partner. Without free media and free civil society, civilian control of the military and checking of business responsibility and stemming of corruption simply isn't possible. Criminality in Russia is rampant; it succeeds because of the violence tolerated by the state against journalists, including the American Paul Khlebnikov of Forbes who was murdered in Moscow.

I imagine there are those who can make the case that keeping Russia out of the WTO can help make this linkage viable. The problem is that the Obama Administration is not willing to raise human rights except very quietly, and it is not willing to link for a good cause, so the WTO membership will go forward. And it doesn't seem that membership in the WTO would harm human rights; if anything, perhaps more foreign presence and scrutiny might start serving as more of an impetus to Russian government bodies to be less abusive and criminalized. Or maybe not.

But as for Jackson Vanik, there is simply no valid reason to remove it. None at all. It must be kept firmly in place. It is not a relic; it's a triumph of placing morality at the core of foreign policy that Obama should not destroy as it will never be able to be put back. It is still useful for those few countries with non-market economies that do not allow free travel and emigration (Turkmenistan). It demonstrably does not apply to Russia, which now has a market economy and allows emigration. So the president can simply rule that henceforth it doesn't apply to Russia permanently -- full stop -- without having to destroy the law itself.

The Russians would like the smug moral victory of eliminating this irritant not because they changed, but because they didn't. The Jackson-Vanik was only about emigration, not about other human rights, but the hearings in Congress generated by this law enabled scrutiny of other rights, too. We shouldn't move the goalposts, but we should realize that scrutiny still matters. The Russians would love to remove a cold-war "relic" because it would prove that the Americans were wrong to make morality a core of foreign policy, and they are right to make cynicism a core of foreign policy, and go on rampantly and cynically violating human rights at home in ways that are simply not equivalent to anything that the U.S. does at home or in the world. There is no need to give them that smug immoral victory. Yes, Jackson-Vanik doesn't apply to them; each year the president waives it. A permanent waiver can be arranged with cooperation with Congress and the president, without removing the law.

http://3dblogger.typepad.com/minding_russia/2010/02/jacksonvanik-a-test-of-wills-the-us-must-meet-not-with-repeal-but-graduation.html

 

AGENT NKVD

1:27 AM ET

June 26, 2010

From the trench of the Cold War.

"violating human rights" hey, I even know the name of that man!

"But as for Jackson Vanik, there is simply no valid reason to remove it" But these were found to Ukraine, Georgia and Kyrgyzstan. After the revolutions in these countries when he was included political assassination, censorship and propaganda, but you do not notice them tactfully. If you read what he wrote, Paul Klebnikov, you'd realize how stupid that what you wrote. The moral law, this is what you have is long gone.

 

EUGENE ONEIL

12:49 AM ET

July 18, 2010

Russia's joining WTO

The need for Russia to join the WTO was echoed at Davos by the president of Ukraine, Viktor Yushchenko, whose country was also seeking membership. Accession by Moscow and Kiev to the WTO would help harmonize relations between the two countries, Yushchenko said. Russia and Ukraine applied for WTO membership in 1993. pa auto insurance Until recently, a trade dispute over meat between Russia and Poland, which joined the EU in 2004, has hampered broader discussions between the EU and Russia. However a thawing of relations between Moscow and Warsaw following the formation of a new Polish government has helped improve the atmosphere, making resolution of outstanding problems possible, Mandelson said. WTO membership would place Moscow within the organization's trade dispute settlement system and lead the way to a trade pact with the EU. Outstanding issues with Europe over Russian membership include a dispute with Finland and Sweden over tariffs applied to timber exports from Russia, and with Lithuania over the fees charged for train transit to the Russian enclave of Kaliningrad. Relations between Russia and Britain also have deteriorated recently, but this has not affected the negotiations, Mandelson said. ak car insurance Other WTO countries also would need to resolve problems with Russia before it could join - including the United States, which has been pressing for a cap on Russian agricultural subsidies. To meet WTO standards Russia also will have to alter laws on intellectual property rights.