Custom Union Impedes WTO Joining

By Aleksey Portanskij

Geneva welcomed first joint conferences of delegations from Russia, Kazakhstan and Belarus with WTO member-states on joining this organization. As a result Russia, Kazakhstan and Belarus intend to resume negotiations on joining the World Trade Organization as individual states, but in cooperation with each other. And the three states still strive to join WTO as soon as possible as a Custom Union.

In practice, the terms of negotiations resumption remain unknown. The case is that during conferences in Geneva the delegations from Russia, Kazakhstan and Belarus were asked a number of questions concerning Custom Union. To resume talks WTO member-states want to learn what will be the establishing Custom Union in practice, what are the sphere of its competence, how national legislations of its participants will be modified, what the process of decision-making will be, how they will harmonize the liabilities, that Russia and Kazakhstan have already taken during previous talks, etc.

For everybody, who at least generally knows about the process of Russia WTO joining, this means only the play back. Answers on these questions get us back to the very first stage of our talks in 1995, when Russia as an applicant for joining was asked numerous questions on trade-political regime in the Russian Federation in accordance with the procedure. There were about a thousand questions. And it took 1,5-2 years to answer all of them.

Now in Geneva the three countries were asked the most important, key questions concerning the establishment of the Custom Union. But most likely, after a while there will rise new specifying questions concerning the given replies. It’s now impossible to predict how long this process will last. The case is that current situation differs greatly from the situation of the same Russia at the first stage of negotiations with the level of its uncertainty. If the Russia of 90-s had answers almost for all the questions, then the three member-states of the Custom Union have no such answers yet. As the Custom Union is not yet established, its fundamental documents exists only on paper, the general custom tariff and unique custom code are not in power – they need to be approved by the heads of the states and no one can firmly describe the process of decision-making in the Union, etc.

Thus, in these terms we can definitely state only one thing: the process of WTO joining for Russia considering the factor of the Custom Union prolongs comparing with the situation existed before June 9th of 2009 (when the reformation for the Customs Union joining was announced). The Chair of the working group on Russia WTO joining Stefan Johannesson has recently said that the attempt of Russia to join WTO simultaneously with Belarus and Kazakhstan can postpone the joining of the Russian Federation for a long period. A few weeks earlier, the WTO Director-General Pascal Lamy claimed in “New York Times” that the new configuration complicates the application of Russia and its joining WTO will prolong. In addition, judging by its experience of talks with Russia when he was a trade commissioner of the EU, Lamy also added: “Fundamental reality is that Russia has no more energy to join the organization”.

Now matter how hurtful the kind of evaluations are, we should take them into account. We can’t justify our delay in the process of joining with crisis. Remaining out of WTO, Russia deprives itself of the possibility to participate in the process of solving a huge block of international problems – starting with the development of norms of international trade and finishing with environment preservation. Imaging itself as a great power, we strive for active participation in the establishment of global management within a post-crisis world. However, we don’t completely understand that for this we should at least participate within the activity of international institutes, including WTO as an integral element of this global management. Though we need WTO for our own development. Without being its member we won’t be able to establish normal competitive environment and perform modernization.
Translated by EuroDialogueXXI from politcom.ru