WTO Accession Process Heats Up as Ministerial Approaches-UPDATED

2 November 2011

Breaking News: Top Russian negotiator Maxim Medvedkov announced late Wednesday night that Russia and Georgia have come to an agreement on Moscow's WTO accession bid. Representatives from both countries are reportedly meeting today in Geneva to confirm that they are indeed in agreement.

Medvedkov told reporters that the two countries had agreed that trade in the Abkhazia and South Ossetia regions - which had long been a subject of disagreement between the two countries - would be monitored by an independent company, working in concert with Russian and Georgian customs officials. The deal is the result of a Swiss-brokered compromise that had been presented to the two parties last week.

"Now we only have some little technical details to approve our bid; the most important things are left behind," Medvedkov told reporters.

ICTSD will provide an updated version of this story as more details become available. For the original story published in Wednesday's version of Bridges, please see below.

ICTSD reporting; "Russia Reaches Agreement with Georgia on WTO, Negotiator Says," BLOOMBERG, 3 November 2011; "Russia Declares Deal to Join Trade Group," NEW YORK TIMES, 3 November 2011; "Russia Deal With Georgia Clears Way to Join WTO," WALL STREET JOURNAL, 3 November 2011.

*** Previous Bridges Story

Trade negotiators are making a concerted push to finalise Russia's entry to the WTO by the December Ministerial Conference, with reports emerging that Russia's long-standing disagreements with neighbour and WTO member Georgia could be resolved within days. The past weeks have also seen major strides in the accessions of Vanuatu and Samoa to the global trade body.

Russia's membership bid has been in the works since 1993, making it the largest economy and only Group-of-20 nation still outside the WTO. Late last month, Russia and the EU announced that they had reached a deal on the outstanding issues between them, leaving Russia's disagreements with Georgia as the only remaining hurdle to WTO membership (see Bridges Weekly, 26 October 2011).

Traditionally, members have joined the WTO only with the consensus of all current members; until recently, it had appeared that Tbilisi might attempt to block the bid due to ongoing political disputes with Moscow.

The two neighbours have long quarrelled over Russian-controlled enclaves in Georgia - South Ossetia and Abkhazia. The two countries fought a five-day war in 2008, and tensions after the war have remained.

Georgia has been seeking trade-monitoring missions on its border with Russia, refusing to back Russia's WTO bid otherwise. A Swiss-brokered compromise proposal that would allow private contractors, hired by neutral parties, to conduct trade-monitoring on the Russia-Georgia border received backing from Georgia on 27 October. This is reportedly a softer position from Georgia's prior request to have government employees run the monitoring process.

A meeting of the formal Working Party on Russian accession is now scheduled at the WTO for 10-11 November. The decision to hold the Working Party was made at the 27 October informal meeting of the Working Group on Russia's accession.

If Russia's outstanding concerns regarding the Swiss-backed proposal are addressed at the formal Working Party next week, then Arkady Dvorkovich - the top adviser to the Russian President - has stated publicly that he sees no "substantial impediment" to approving Russia's accession documents at the meeting.

US lawmakers continue pushback

Though the US has officially been backing Russia's WTO bid, many US lawmakers have lately been protesting against Moscow joining the global trade body unless certain policy changes are made.

On 29 October, Republican and Democratic leaders of both the powerful Senate Finance and House Ways and Means committees jointly addressed a letter to US Trade Representative Ron Kirk on the issue. The congressional leaders expressed concerns over a range of areas, particularly Russia's intellectual property rights protections, blockage of market access for US agricultural products, and automobile investment policies.

"While we recognise that Russia has made progress in opening its economy since 1991, the accession should address the serious problems that remain," the letter added.

The US Congress still needs to repeal the Jackson-Vanik amendment - a Cold War era restriction on trade with Russia that allows the US to deny most favoured nation (MFN) status to nations with limited freedom of emigration - and restore permanent normal trade relations with Russia.

Vanuatu, Samoa also on the accession track

Though recent headlines have largely centred on the Russian accession process, the global trade body has also made moves over the past weeks toward welcoming two more WTO members that, like Russia, launched their accession bids over a decade ago.

The WTO currently has 153 full members, and announced last week that the General Council - the organisation's highest decision-making body outside of the biennial Ministerial Conference - had approved Vanuatu's accession package. Upon ratification by Vanuatu's parliament, the country will become the WTO's 154th member; Vanuatu had launched its membership bid in 1995 (see Bridges Weekly, 26 October 2011).

With another announcement on 28 October that the formal Working Party on Samoa's 12-year membership bid had adopted its accession package and would be forwarding it on to trade ministers at the December gathering, the global trade body could potentially have three new members by the end of the WTO Ministerial Conference in six weeks' time.

ICTSD reporting; "US lawmakers urge Russian reforms for WTO bid," AFP, 31 October 2011; "Russia Expects WTO Entry by December After 18-Year Wait After Swiss Talks," BLOOMBERG, 30 October 2011; "Russia's 18-Year WTO Quest Nears Fruition as Georgia Backs Swiss Proposal," BLOOMBERG, 27 October 2011; "Deal for Russia to Join W.T.O. Is Accepted by Georgians," NEW YORK TIMES, 27 October 2011; "Russian Aid Says Issues With Georgia on Joining Trade Group May Be Settled Soon," NEW YORK TIMES, 30 October 2011; "After 18 years, Russia on verge of WTO membership," REUTERS, 27 October 2011; "Swiss mediators hope Russia can join WTO this year," REUTERS, 30 October 2011.

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