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27 Dec, 2006 05:11

Russia may join the WTO by mid-2007

Russia may join the WTO by mid-2007

According to Russia's Deputy Prime Minister Aleksandr Zhukov, talks on Russia's accession to the World Trade Organisation may be completed by mid-2007. Currently Russia remains the largest economy still outside the WTO.

In November Russia made a major leap toward becoming a WTO member when it signed a bilateral agreement with the United States, a country considered to have the last say on Russia's accession to the organisation.

Speaking to reporters shortly afterwards, Russia’s Economic Development and Trade Minister German Gref said joining the WTO is a must: 

“Our first and main interest is pragmatic. We want to participate in global trade and make sure our goods and services are not discriminated against in the process. The competition is stiffening all over the world, and it's impossible to be a major player on the world markets without being a WTO member,” Mr Gref said.

Before striking a bilateral deal, Russia and the United States had to solve several sticking points in negotiations observers said were the toughest in Russia’s 12-year-long effort to join the WTO. They included agricultural trade barriers, piracy-protection mechanisms, and import duties on aircraft and other products. 

Under the bilateral deal, Russia has agreed in principle to liberalise its financial markets, which some experts say, should benefit the sector. In line with this decision, foreign-owned brokerages and investment banks will enter the country and foreign banks will be able to establish 100 % owned subsidiaries. Unlike insurance companies, they won’t be allowed to set up direct branches.  

The state regulators also agreed to boost the foreign capital limit in the banking and insurance sector to 50 %. 

While official Moscow still has to sign bilateral agreements with several countries including Moldova, El Salvador, Guatemala and Costa Rica, most experts and government officials say Russia may join the 150-member organisation sometime in 2007.