Economic Policy Program
Georgia, in exchange or which Georgia removed its objec-tion rom Russia’s accession to the WO.
For both Russia and its trading partners, accession to theWO marks a major milestone or bringing Russia intothe rules-based trading system. It presents a tremendousopportunity or Russia, particularly as WO membership islikely to make Russia a more attractive home or the oreigndirect investment it needs to und its “new industrializa-tion” policy. For the WO, Russia, with its 143 millionpeople and its $1.791 trillion in GDP, represents the largesttrading country that was not yet a member. And or thebiggest traders, the United States and the European Union,Russia’s accession means signicantly improved access tothe Russian market and greater assurance that Russia willplay by the WO rules.Te stakes or Europe and the economic relationshipbetween the EU and Russia are particularly high. Te EU isby ar Russia’s largest trading partner, accounting or 47.1percent o Russia’s overall trade. Europe is also by ar themost important investor in Russia, with FDI stocks investedin Russia o more than €120 billion. Europe largely importsenergy and mineral uels rom Russia, along with somemanuactured goods, chemicals, and raw materials, whileEurope’s exports to Russia cover a wide variety o goods,ood, machinery, and transport equipment.For the United States, Russia is a smaller but very importanttrading partner, with two-way trade between the UnitedStates and Russia o $31.7 billion, making Russia the UnitedStates’ 23
largest goods trading partner. For the UnitedStates, Russia is a key market or machinery ($1.7 billionin exports), meat ($642 million), vehicles ($484 million),electrical machinery ($395 million), and optic and medicalinstruments ($383 million). Like Europe, U.S. importsrom Russia are concentrated in oil ($18.5 billion), iron andsteel ($1.3 billion), enriched uranium ($1.3 billion), nickel($727 million), and platinum ($710 million). Comparedto Europe, the United States has a much smaller level o oreign investment at $9.9 billion, with Russian investmentin the United States at $7.8 billion.
Recent studies examining the eect o Russia’s accessionto the WO indicate signicant positive economic eects virtually across the board, along with critical but harder toquantiy benets o having Russia part o the rule-basedtrading system and subject to disciplines that guard againstprotectionist measures or unilateral actions. For the UnitedStates, Anders Aslund and Gary Huauer predict that i theCongress grants PNR status to Russia, allowing the UnitedStates to reap all o the benets contained in Russia’s acces-sion package, U.S. exports o goods and services to Russiawill likely double within ve years, rom $11 billion in 2011
Russia’s Accession Protocol Package
Protocol of Accession
— basic legal text of what
Russia has commied to do to bring its trade lawsand pracces into compliance with WTO rules,including non-discriminatory treatment of goodsand services imports; ensuring transparencywhen implemenng trade measures; liming andreducing agriculture subsidies; enforcing intellec-tual property rights; opening government procure-ment contract opportunies to foreign rms; andacceptance of WTO dispute selement procedures.
Working Party Report
— summarizes proceedingsand sets forth more detailed condions of entry;some paragraphs are expressly incorporated byparagraph number into the Protocol and henceinto the WTO Agreements.
Schedules for tari bindings
— reducons in tarison industrial and consumer goods from almost 10percent to 7.8 percent on average, with larger cutsfor chemicals, aircra, and farm machinery, andcuts to 0 percent on informaon technology prod-ucts; reducons in taris on farm products from 13percent to 10.8 percent on average.
Schedules for services bindings
— openingservices markets to 100 percent foreign ownershipof companies in banking, securies, non-life insur-ance, telecommunicaons, audiovisual, wholesale,distribuon, retail, and franchises.