Bridges Weekly Trade News Digest • Volume 13 • Number 26 • 15th July 2009

Russia to Resume Unilateral WTO Bid

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In a second about-face in fewer than five weeks, Russia indicated on Thursday that it intends resume its bid to join the WTO as a single member state. Moscow appeared ready to drop the 16-year-long effort last month, when Russian Prime Minister Vladimir Putin made a surprise announcement that the country would only seek WTO Membership as a customs union with Belarus and Kazakhstan (see Bridges Weekly, 10 June 2009, http://ictsd.net/i/news/bridgesweekly/48333/).

But now the country appears to have reverted to its earlier position.

“Russia will be conducting talks regarding WTO Membership on its own,” Arkady Dvorkovich, Russian President Dmityr Medvedev’s top economic advisor, told reporters on Thursday, AFP reported.

“As consultations have shown, the entry of the customs union to the WTO will be a hard, years-long process. Therefore another scenario is parallel accession of the three customs union member countries, which coordinate their positions and enter the WTO at the same time but as three sovereign states,” Dvorkovich added.

“What is important is that Russia is interested in joining the WTO and hopes that that happens quickly,” he said.

The Marrakesh Agreement, which established the global trade body in 1995, contains no provision for the admission of customs unions to the WTO, a fact that several delegations made clear to Russian envoys in consultations at the WTO in recent weeks.

WTO Director-General Pascal Lamy said last month that he was ‘perplexed’ by the proposed customs union approach. Similarly, US Commerce Secretary Gary Locke, who visited Russia with US President Barack Obama last week, said he was a ‘bit mystified’ by Moscow’s decision to switch tactics, especially since Russia’s unilateral membership bid appeared to have been gaining momentum just before Putin made his announcement.

The customs union idea does not appear to have been completely cast aside, however. In remarks on Tuesday, Medvedev said that Russia could join the WTO “in one of two ways.” One way, via a customs union “would be nice but quite difficult,” the leader acknowledged.

“Or we can join a different way. Having agreed on some common standards and positions within the tripartite Customs Union, we could accede separately, which in my view would be the simpler and more realistic option,” he added.

The recent switch in tactics is not the first time that Russia has taken an abrupt step back in its bid to join the WTO. Last year, under pressure from the US and the EU over Moscow’s role in separatist conflict in South Ossetia and Abkhazia, Putin said that Russia did not “feel or see any advantages from Membership” in the WTO (see Bridges Weekly, 4 September 2008, http://ictsd.net/i/news/bridgesweekly/27680/). Just two months later, however, the negotiations appeared to be back on track (see Bridges Weekly, 30 October 2008, http://ictsd.net/i/news/bridgesweekly/32395/).

Russia is by far the world’s largest economy that remains outside the WTO, which counts 152 states plus the European Union as Members.

ICTSD reporting; “Russia may still pursue solo WTO membership: official,” AGENCE FRANCE PRESSE, 10 July 2009; “Russia’s WTO bid within customs union ‘not workable’,” BLOOMBERG, 8 July 2009; “Russia’s WTO prospects still unclear - WTO chief,” RIA NOVOSTI, 24 June 2009.