Somehow WTO managed to get by without Russia all these years. If Russia doesn't need/ WTO why join?Originally Posted by Arbody
Well he is right and you`re right , Russia doesn`t need WTO and WTO can manage without Russia. What really changed things is "big" bussines pressure in US to remove all trade barriers between US and Russia , with Russia joining WTO Jackson-Vanik amendement is de-facto dead.
In fact Russia didn't join. WTO adopted the substance of the instructions on the World Trade with Russia. Theoretical joining will be in the summer 2012.
I heard that not month, till June or July 12
Months offcourse.
Do our Russian friends want to chime in about what Russia expects from WTO? What does Russia want from WTO officially? Just reading Russian press they report on it, they paint a positive picture but I can't really find many actual positives or a discussion of them. Seems a bit high level stuff like "good for the economy" but without a discussion fo how exactly is it supposed to make it good.
Opposition talks about it as "now it's even easier to sell our Mother Russia dry!11"
Pro-gov talks about "good for economy" usual blah-blahs.
The rest of us are simple don't care due to to not being economists and/or not giving a damn.
It could serve to improve investor confidence, now that the Russian economy finally has the "stamp of approval" of the WTO.
I was reading a lot trying to get some answers, but the only thing I came to understand was that nobody really knew what the WTO impact on our economics would be. There are too many pros and cons, and nobody can predict what will weight more in the end. Personally I think (or rather hope) that joining WTO is a good idea after all. Making life harder for parasites like AvtoVAZ, and forcing them to work instead of lobbying for preferences, would overweight all negative WTO effects.
Congratulations to Russia, now they can override the USA Supreme Court! Ah yes and their equivalent can be overriden as well! Sovereignty is overrated.
Relax Arbody, relax... International accords tend to follow international law. When you have situations as between Russia and Georgia, accords become more difficult. Similar considerations need to be made in regard to Northern Cyprus, Transnistria or Taiwan. Be honest, did you try to understand my post or just saw Georgia and Russia in the same sentence and jumped the gun.
I do wonder how much Russia will benefit from WTO. They do not have an incredibly large manufacture based economy to benefit from the absence of custom taxes. I actually expect to see a surge in common goods imports (most likely from China). Also, since their main exports are natural resources, I do not see the receiving countries imposing taxes to protect their local markets...so no WTO need there. The only benefits will be felt by metallurgical, chemical and similar large manufactures (is this though a large enough sector to balance the common goods imports?). Last, there is the idea that if you are part of the WTO will help attract investments, but can Russia compete with China on the cheep workforce level? Don't forget that the investors who need high-end skills will come anyway. WTO will probably end up being a good think on the long term since will force companies to be more productive.
Considering that for the last 10 years I kept hearing about Russia's attempt to join WTO, I am really surprised to hear that this is not actually popular with the people.
The metallurgical, chemical and oil producing industries will surely benefit from WTO conditions. That is a huge chalk of Russian economy and, of course, the most powerful in terms of lobbying skills.
No, it wasn't. The most peoples don't giving a damn about WTO (Einhander is right here) while the others don't really like to risk their working places because of "those clowns" in government.Considering that for the last 10 years I kept hearing about Russia's attempt to join WTO, I am really surprised to hear that this is not actually popular with the people.
My personal opinion is that Russia would gain some more market opportunities from being a WTO member, so congrats to everyone
The contrary result is more probable, i.e. potential investors will lose incentive for investing in the Russian manufacturing industry and other branches with high added value. It is simpler to import ready goods, if there are no customs barriers. Attractiveness of Russia as a place for export production is inevitably low: there are many places with cheaper working force (it is useless to compete with “Asiatic sweatshop capitalism” in this respect) and better business climate (it would be naïve to expect that deeply rooted corruption and excessive bureaucracy can disappear within few years). At the same time, the most part of Russian companies are still weak and hardly can succeed in competition “on equal terms” with big and long-established transnational corporations and banks.
Practically, WTO is obviously advantageous only for some Russian producers of half-manufactured materials, mostly metals and industrial chemicals, which suffer from prohibitive quotas in USA and EU. These branches give the lesser part of Russian export, but they are highly monopolized and represented by some well-known billionaires-oligarchs who received their gigantic plants from Eltsin and close to Medveputs as well.
Besides, the Russian assembly subsidiaries of foreign companies, just as their sale offices and related Russian distribution networks will gain. They also possess disproportionate political strength in Russia because concentrates in Moscow and S.-Petersburg mostly and intimately connected with the ruling top of bureaucracy.
Production of oil, gas and other raw materials such as wood, grain, fertilizers etc. (i.e. most part of the current Russian export) is marketable irrespective of WTO and the membership is irrelevant for them.
All other sectors of economy will probably suffer from full involvement in “globalization games”, it is unclear only to what extent.
The intensive branches of agriculture and food industry (such as meat and milk industry, confectionery etc.) will suffer, they hardly can compete with countries enjoying better climate or bigger state support, and with big and rich transnational companies like Unilever, Nestle, Danone etc. The light industry (clothes, footwear etc.) will be finally lost, it can not compete with the countries of cheap working force and with well-marketed West European brands. That will be very bad for little towns and the country, and for demography of Russia eventually.
The most part of manufacturing industry will probably suffer, such as various kinds of machine-building or production of pharmaceuticals. The weakened Russian companies can be finished off by foreign competitors with much higher resources. The Russian government has tried to assure temporary preferences for the Russian aviation, ship-building etc. firms, but it may not be true that they will be sufficient.
And the sector of services will probably suffer a lot – banking and insurance, transportation, construction companies etc., which employ numerous people.
WTO is an organization which consolidates already achieved positions. But the Russian value-added branches are still far from the best shape. “Free world market” and “free competition” against much stronger and sophisticated adversaries, without the due support of the own state, can be destructive for them.
This is also the issue of more deep ideological dissent. Some people in Russia want “integration into the world community” (and the civilized world is reduced to USA and EU in their opinion) at any cost and cheers any “globalization projects”. They are minority, but they are in power now (the current president Medvedev is an exemplary representative of this specific species). The most part, on the contrary, would prefer more closed borders for unnecessary people and goods from abroad, i.e. less immigration and more protectionism (this does not mean “full autarchy”, of course, only stricter regime for those goods which can be reasonably produced inside Russia-Belarus-Kazakhstan with the due level of internal competition). But now this part of society is actively disregarded by the ruling regime.
Russia joins WTO after 18 years of negotiationshttp://www.usatoday.com/money/econom...ion/57207664/1MOSCOW – After 18 years of negotiation, Russia on Wednesday entered the World Trade Organization, which restricts import duties and subsidies in an attempt to create a level playing field for international trade.
Analysts and politicians hope that Russia, which has long proven a formidable market to foreign investors because of its byzantine bureaucracy and protectionist tariffs, would be transformed by its entry into the WTO. Russia is one of the last major global economies to enter the group, which has long included other developing nations like China.
While consumers in Russia will benefit from the lower cost of imported goods, some worry that struggling industries long coddled by state subsidies, such as agriculture or the automobile industry, will suffer from foreign competition.
Russians often complain about the burdensome cost of Western-imported consumer products, which range from refrigerators to jeans. With its entry into the WTO, the country will cut its average import tariff by 5.9%, making those imports cheaper.
M. Video, one of Russia's largest electronics retailers whose shelves are packed with foreign-made CD players and American movies, said Russia's entry into the WTO would bring more customers into their stores.
"We believe that (entry into the WTO) is going to be a very good decision for our customers in the future, because they will be able to purchase goods with prices harmonized with other economies," said Enrique Fernandez, chief commercial officer of the company.
But uncompetitive domestic goods, which have long been propped up by Soviet-style subsidies, could be threatened by the invasion of higher-quality imports. Nearly 100 major business leaders and industry groups, including dairy and meat producers, signed a petition earlier this summer addressed to the ruling United Russia party, asking that its deputies vote against ratification of the WTO treaty.
Agriculture, the automobile industry, and Soviet-style "Monogorods," or towns which revolve around a single factory or industry, are bound to suffer against foreign competition unless they can reform quickly. These industries are based in regions that have often displayed the most support for President Vladimir Putin, but could easily turn into a hotbed for protest if already fragile industries begin to collapse.
At a car dealership in Moscow, 63-year-old engineer Alexei Tarakanov said he doubted that low-quality Russian cars could compete on the open market.
"I already have a negative attitude towards our (Russian) cars," said Tarakanov, who was buying a Renault. "I doubt that they can win the preference of the modern buyer."
Because state-subsidized industries proved such a pivotal issue in Russia's WTO negotiations, financial aid to struggling sectors will be gradually phased out, rather than abruptly cut off, over the course of seven years.
"The industry will not collapse immediately, (major Russian car-maker) AvtoVaz is going to continue steadily producing its 700,000 cars per year," said Ovanes Oganisyan, an analyst at the Moscow-based investment bank Troika Dialog. "But eventually there's going to be more competition, and if AvtoVaz doesn't change in seven years it will have to go out of business."
In addition to the challenges faced by unreformed industries, the Russian government expects to take a short-term financial hit from the loss of income from import duties and taxes. But the government emphasizes long-term gains, and the World Bank has estimated that WTO membership could increase Russia's GDP by an extra 3.3 percentage points a year in the next three years.
While the WTO will significantly open up the Russian market to foreign producers, theU.S. faces the threat of paying higher tariff rates than other WTO members to sell goods in Russia, leaving American producers at a competitive disadvantage compared to European or Asian industries.
The reason for the disparity is the Jackson-Vanik Amendment, a law passed by Congress during Soviet times that denies Russia normal trade relations with the U.S.
The U.S. president has been granting Russia annual waivers since 1992, but Moscow insists it will not lower its tariffs for the U.S. as much as for other countries until the law is scrapped.
"The last thing that America needs right now is for foreign companies to have lower tariff rates than American companies," said Andrew Somers, President and CEO of the American Chamber of Commerce.
Vice President Joe Biden lobbied for the repeal of Jackson-Vanik in 2011, as have previous presidential administrations, but Congress has so far proven intransigent to executive pleas.
Congress has increasingly taken fire at the Russian administration for its human rights record. In June, the U.S. House of Representatives passed the Justice for Sergei Magnitsky Act, a bill named for a Russian lawyer who died in a Russian prison last year after allegedly being abused at the hands of Russian authorities.
This week, President Barack Obama expressed his disappointment after the three participants of Pussy Riot, a punk band who sang an anti-Putin prayer in Moscow's Cathedral of Christ the Savior, were convicted to two years in prison.
"Business hates uncertainty," said Somers, "If the Jackson-Vanik Amendment remains on the books and the U.S. continues not to have normal trade relations with Russia, who knows what will happen."
Alexander Roslyakov, Andrei Bulay and Nataliya Vasilyeva contributed to this report.
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Russia let EU observers on Georgian border to Russia in abkhazia region to monitor border and on Georgian border to Russia in Samachablo(South ossetia) region to monitor.
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