Russia
stood Thursday on the verge of ending its tortuous 18-year wait to get into the
World Trade Organisation after accepting a Swiss-mediated deal that removed
reservations by its arch-foe Georgia.
The decisive breakthrough with the last
holdout nation came after months of closed-door diplomacy in Switzerland
between two rivals that have only had limited ties since waging a five-day
border war in 2008.
Russia is now finally poised to shed its
status as the world's largest economy outside the world's premier free trade
club by winning formal accession at a meeting tentatively set for the middle of
December.
"We are happy that Georgia supported the
draft and that the agreement has finally been reached,"
Interfax quoted chief Russian negotiator Maxim
Medvedkov as saying.
The news was initially broken by the Georgian
side after days of silence from Moscow over what Tbilisi had clearly indicated
was its final offer.
"The Russians have agreed on the Swiss proposal.
We have no details about their decision, but it looks like the deal is
made," Georgian Deputy Foreign Minister Sergi Kapanadze told AFP.
Tbilisi had been demanding international
monitoring of cross-border trade in its Russian-backed breakaway regions of
Abkhazia and South Ossetia. Moscow had wanted to police the border with the
help of local and Russian patrols.
Medvedkov said a part of the deal would see an
independent company contracted to audit trade in the disputed region.
That firm would also act as a mediator and
information handler between Georgian and Russian customs agents.
The agreement "is based on our proposal
and does not go outside the frameworks of Russia's principled stand,"
Medvedkov said.
"It corresponds to the realities that
have emerged in the region and does not contradict WTO norms," said the
Russian negotiator.
Kapanadze for his part said that a Georgian
delegation would be arriving in Switzerland later Thursday for talks with the
Russians and the Swiss negotiators.
"I think the agreement will be signed
within several days," he said.
There are two more lower-level WTO sessions
scheduled for November before all of the bloc's top representatives gather for
a December 15-17 ministerial meeting at which Russia's membership is due to be
put up for a vote.
Russia has already ironed out its disputes
with the European Union and has no direct trade issues remaining with the
United States. Other big nations such as China are also on board.
But the US Congress has still not revoked the
1974 Jackson-Vanik amendment -- a piece of Cold War-era trade legislation that
strips most-favoured nation status from countries impeding the emigration of
Jews to the West.
That amendment could theoretically lead to
retaliatory steps being taken against the United States once Russia joins the
WTO.
Analysts are united in viewing free trade as a
net benefit for Russia.
The World Bank estimates that WTO accession
may add up to 11 percent to Russia's gross domestic product as the business
process becomes more streamlined and the investment climate improves.
But some economists warn that membership has
its price -- something that Vladimir Putin has often referred to while serving
as both president in 2000-2008 and prime minister today.
Putin is set to return to the presidency in
March elections. The final push for membership was spearheaded by the more
modernising administration of President Dmitry Medvedev.
Analysts say the WTO will sound the death
knell for some Russian companies that sell to domestic markets that suddenly
become flooded with cheaper -- and often much better -- goods.
The new rules will also hurt Russian airlines
that lose the extra tariffs they levy on European carriers that fly over
Siberia. And Russian farmers will have a much harder time securing
protectionist policies from the state.
"However, we think that many of these
concerns reflect a lack of understanding about the exact nature and magnitude
of the potential gains from joining the WTO," the Renaissance Capital
investment house wrote in a recent note.
"Doubts stem from gains not being well
articulated," it noted.
The investment house observed that most of the
benefits for Russia would come from better efficiency, as money flowed to more
competitive sectors.
Dmitry Zaks | AFP News
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