Russia closes WTO deal - details
On 10 November 2011, the Working Party on Russia's accession, chaired by Ambassador Stefn Jhannesson (Iceland), agreed, ad referendum, on the terms of the country's membership to the WTO by adopting the package containing reforms to Russia's trade regime, and the commitments that Russia undertook to implement as part of its WTO accession.
"It has been a long journey, but today Russia has taken a big step towards its destination of membership in the WTO. In acceding to the WTO, Russia embraces a series of rules and commitments that are the foundation of an open, transparent and non-discriminatory global trading system. This system provides important guarantees for Russia and for the 153 other Members of our organization. This win-win result will bring Russia more firmly into the global economy and make it a more attractive place to do business. For the WTO, it comes as a most welcome deliverable for the upcoming WTO Ministerial Conference and signals anew the relevance and vibrancy of the WTO as an instrument for international co-operation," said Director-General Pascal Lamy in a press release with more details, which you can be found here.
Main points are:
- Average tariff ceiling for imported agriculture products will be 7.8% compared to 2011 average of 10% for all products. One third of tariffs will be reduced on the date of accession, another quarter will be in place three years later. The longest implementation period is for poultry (8y), aircrafts, motor cars (7y).
- Russia has made commitments on market access in 11 services sectors.
- In telecoms foreign equity limitation will be eliminated.
- Foreign insurance companies would be allowed to establish branches (in 9-years).
- Foreign banks would be allowed to establish subsidiaries (Currently foreign banks can only establish standalone banks with full-scale license).
- No discrimination in transportation tariffs for imported goods.
- Quantitative restrictions, such as quotas should conform with the WTO provisions.
- Agricultural subsidies will be reduced from current $9 bn to 4.4bn by 2018.
- Russia will use international standards for the development of technical regulation
Citi analyst Ian Colville commented: "The terms do not seem surprising. As we discussed before, Russia has already implemented the major part of changes. The immediate effect will be quite limited, less than 1% in terms of tariff protection. However the long-term impact will be positive mainly because of better technical and tariff regulation."
