Russia to break with WTO accords

[MikeWB]

Russia is now fully woken up!

Russia decided on Monday to break off some trade agreements reached during negotiations to join the World Trade Organisation (WTO) as relations between Moscow and the West grew increasingly tense.   

The move to withdraw from some of the accords reached over years of arduous talks came at a meeting of an inner circle of Cabinet ministers chaired by powerful Prime Minister Vladimir Putin.

It confirmed Russia's disillusionment with the complex negotiations needed to enter the 153-nation trade body.

"Russia intends to inform various WTO partners of its withdrawal from accords that contradict its interests," First Deputy Prime Minister Igor Shuvalov told Putin at Monday's meeting, quoted by Interfax.

In response, Putin gave his assent, saying: "That is reasonable."

Putin, who stood down as president in May but remains highly influential, went on to reiterate previous Russian objections, notably the effect of WTO rules on agriculture, while affirming that membership remained a goal.

"It turns out that we don't see or feel any pluses from membership and if there are some, we still carry a burden," said Putin.

"We need to get things clear with our partners ... We need to think most seriously about protecting our manufacturers.

"This doesn't mean we should renounce our strategic course towards the WTO, but there should be some clarifications on this question ... Elementary fairness should prevail," said Putin.

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Shuvalov said he in any case saw little chance of finishing entry negotiations within the current year. Russian officials did not specify which accords would be scrapped.

The comments come against a background of deteriorating relations between Moscow and the West over Russia's military surge into southern neighbour Georgia and support for separatists there, as well as over US plans for new missile defence facilities in Europe.

Putin made joining the WTO a key objective when he first became president in 2000, but appeared increasingly frustrated with the process as his second term drew to a close and he had still not achieved membership.

As tensions have mounted over Georgia, German news magazine Der Spiegel this weekend quoted US Commerce Secretary Carlos Gutierrez as saying Washington's support for Russia's WTO bid could be at stake.

Russia has been trying to join the WTO since its inception in 1995.

Its failure to become a member makes it the only major economy outside the 153-nation trade body.

Russia achieved a milestone towards WTO entry in November 2006 when it signed a bilateral trade deal with the US.

Prior to the conflict in Georgia, Washington had insisted it was keen to see Russia join the WTO.

However, the US has yet to repeal a piece of Cold War-era legislation that still restricts trade with Russia and prevents its WTO entry, the Jackson-Vanik amendment.

In June last year, Putin called for a revolution in the world financial architecture, which he described as "archaic, undemocratic and inflexible".

Negotiations on Russia's entry have also been bogged down with its current arch-foe Georgia, which is already a member and has refused to sign off on Russia's bid.

Another trade dispute has arisen with Finland over Russian export duties on timber, partly intended to encourage production of value-added goods like paper and furniture inside the country. -- AFP