GENERAL COUNCIL PAVES WAY FOR UKRAINE TO JOIN WTO

WTO Members rubber stamped Ukraine's bid to become the 152nd Member of the global trade body on 5 February, approving the former Soviet state's terms of accession after 14 years of negotiations.

Ukraine's parliament will have until 4 July to ratify the agreement, although this could be extended. Ukraine would formally become a WTO Member 30 days after ratification.

The vote by the General Council, the WTO's top permanent decision-making body, was largely a formality, after the working party on Ukraine's accession accepted its terms of entry.

Ukrainian President Viktor Yushchenko, who came to Geneva to attend the meeting, declared that "Ukraine's membership to the WTO is truly an historic moment and is a decisive milestone in the development of our economy. We are convinced that our efforts will yield results and allow us to build closer economic ties worldwide."

Yushchenko forecast that GDP would grow by an extra 1.7 percentage points as a result of WTO Membership, reports Reuters. He was especially optimistic about farm exports, predicting that they could rise by up to 44 percent.

An analysis in UK newspaper The Times said that Ukraine's WTO accession "shows that the trade organisation still has pulling power as a club that countries want to join," to the extent that they are willing to make difficult economic reforms in order to do so.

WTO Members' inability thus far to conclude the Doha Round of trade negotiations, even after over six years of talks, has caused some to question the long-term effectiveness of the institution.

"Ukraine's WTO membership will strengthen the multilateral trading system and provide this country with a stable and predictable trade environment that will boost its growth and prosperity," said WTO Director-General Pascal Lamy.

WTO Membership gives Ukraine guaranteed access to the markets of all other Member nations. It also gives Kiev access to the global trade arbiter's dispute settlement procedures in case its trade interests are harmed. This could be particularly useful when neighbour Russia, with which it has an important but strained trading relationship, joins the WTO. Bloomberg reports that the US and the EU will have to drop import limits on Ukrainian steel once the country joins the WTO.

Ukraine's accession commitments required it to cap tariffs at an average of 10.66 percent for agricultural products and 4.95 percent for industrial goods, and to open up a new import quota for heavily-protected sugar. In addition, it has promised not to subsidise agricultural exports, and to limit trade-distorting domestic farm support to roughly $613 million annually.

Kiev will eliminate duties on products including civil aircraft, construction equipment, distilled spirits, pharmaceuticals, certain chemicals and petroleum oils, medical equipment, wood, pulp and paper, steel, information technology products, furniture, and toys.

As for services trade, Ukraine has made binding commitments to open its market to foreign competition in sectors such as business services, communication services, construction, distribution, education and environmental services, financial services, health and social services, tourism, and transport services.

Ukraine also agreed to fully comply with multilateral rules on intellectual property protection and trade-related investment measures as soon as it joins the WTO, without any transition period.

With a population of 46.6 million and a GDP of $106 billion in 2006, Ukraine is the largest country other than Russia and Iran not currently a member of the WTO.

ICTSD reporting; "The world club with real pulling power," THE TIMES, 5 February 2008; "Ukraine Wins WTO Entry Bid, Anticipates Growth Pickup," BLOOMBERG, 5 February 2008; "Ukraine president sees WTO boost to economy," REUTERS, 5 February 2008.