Russia, Belarus, Kazakhstan to Join WTO on Separate, But Coordinated, Terms

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Russia, Belarus and Kazakhstan will no longer seek to join the WTO as a single customs union, trade officials from the three countries said last week. But they still plan to closely coordinate their accession talks, the officials added, and the countries will wait until all of their negotiations have been completed so that the three former Soviet states can join the global trade body simultaneously.

Russian Prime Minister Vladimir Putin stunned trade observers in June when he announced that Russia, Belarus and Kazakhstan would seek membership in the WTO as a single customs union (see Bridges Weekly, 10 June 2009, The three countries will become a customs union as of 1 January 2010.

But current WTO members, whose consensus approval is required for any new country to join the global trade body, were less than thrilled about the idea. There is no precedent for a customs-union bid to join the WTO, and no one was sure exactly how such an accession would work. One thing was certain, though: a joint bid would slow down the accession process, perhaps considerably.

During a series of accession talks last week, officials from Russia, Belarus and Kazakhstan announced a change in strategy. They will still form their customs union at the beginning of the year, but they will enter the WTO as individual states. Each country will maintain its own working party on accession - the official forum in which the bidding country hammers out a deal with current WTO members - but outside those negotiating rooms, the three countries will harmonise their commitment levels on goods tariffs.

Addressing an informal meeting of trade officials at the WTO on 15 October, a representative of the European Union said that the bloc 'welcomed' the new approach.

A customs-union bid would have 'inevitably' entailed "a further delay in the prospects for WTO accession, at least for Russia and Kazakhstan," the EU representative said, adding, "especially if this is going to imply any reopening - whether one calls this 'adjustment' or 'renegotiation' - of any formalised or stabilised prior accession-related commitment."

Russia, by far the largest economy outside the WTO, has been negotiating its entry into the WTO since 1993, as has Belarus. Kazakhstan launched its accession talks three years later.

But even with individual bids, the countries' ultimate membership in the global trade body will require significant more work. Russia continues to face opposition on its meat quotas as well as its export duties on goods like oil, gas and timber products. And the three countries' vow to harmonise their tariff schedules for goods will no doubt slow the talks, as Kazakhstan has reportedly already agreed to limit import duties on some 3,000 goods at levels below what Moscow has deemed acceptable. Negotiating a compromise on that front will no doubt require many further hours of negotiations.

ICTSD reporting.



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