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. Last Updated: 07/27/2016

Has Entering WTO Been Thought Out?

ST. PETERSBURG -- While World Trade Organization General Director Mike Moore was saying Thursday that Russia was making "significant progress" toward joining the global trade body, other delegates at the sixth annual St. Petersburg Economic Forum were wondering what membership will mean, exactly.

Moore said that talks currently under way in Geneva between government representatives and the WTO are "going well" and reiterated his belief that Russia would be granted membership by the end of next year.

Moore said Wednesday, the opening day of the four-day forum, that the biggest obstacle Russia has to overcome is reforming its agricultural sector. Several WTO members are insisting Russia stop export subsidies on agricultural products as a condition of membership.

In addition to resistance abroad, there is growing concern domestically the government has not done its homework properly regarding exactly what the consequences of membership will be.

"The Russian government does not yet have a thorough analysis and forecast of what complications for the real sector of the economy joining the WTO will bring," said Vladimir Gusev, a Federation Council senator who is the deputy of the upper chamber of parliament's economic policy committee.

Gusev's criticism is well-founded. Although the government has set up a special office to handle inquiries and study the ramifications of WTO membership, it has so far failed to produce a comprehensive report detailing how each of the nation's 89 regions will be affected.

Gusev said it isn't even clear what the government's goal is in its current negotiations with the WTO or what the precise conditions of membership will be.

"Unawareness is higher in the regions than in the center, and I think the government should do more to explain what WTO membership will mean to ordinary people," he said.

President Vladimir Putin has made WTO entry on standard terms a key plank in his economic platform, and Prime Minister Mikhail Kasyanov told the forum Wednesday that integrating into the world economy is "the main current economic priority of Russia," the largest economy still outside the WTO.

Georgy Petrov, the deputy chairman of the Russian Chamber of Commerce, said while there was little doubt among the vast majority of producers that Russia should join the WTO, several items remain unclear. The main problem, he said, is legislative reforms required for membership have yet to be worked out, such as passing a new Customs Code.

Petrov said the State Duma needs to pass roughly 20 new laws, including one on external trade policy, to qualify for membership. "Negotiations with the WTO are probably the toughest Russia has ever gone through, and we don't have enough grounds to base our position on," he said.

First Deputy Economic Development and Trade Minister Ivan Materov said that while there will be some problems with being in the WTO, they will be insignificant for the most part.

"All these worries remind me of Y2K, which people expected to threaten the whole world, but in the end no one noticed the change in dates," Materov said. "I think that WTO accession will be the same way for most people in Russia."