Russian Lawmakers Back Accession to World Trade Organization
Russian lawmakers in the lower house of parliament backed the country’s accession to the World Trade Organization, overcoming protests by opposition parties.
The measure passed in the 450-seat legislature, or the State Duma, by a vote of 238-208, with 1 abstaining. The upper chamber is set to consider the bill on July 18 before it goes to President Vladimir Putin for his signature.
Russia, the largest economy outside the WTO, has until July 23 to ratify the protocol for its entry and may join as soon as next month after being invited to enter the organization in December following 18 years of negotiations. The nation’s membership would mark the biggest step in world trade liberalization since China joined the Geneva-based group a decade ago.
The Communist Party and the Just Russia opposition group organized protests outside the Duma today, saying the accession will hurt manufacturers and farmers. Activists carried banners saying “Joining the WTO is the path to the abyss,” according to a statement on the Communist Party’s website.
Russia may lose an estimated 188 billion rubles ($5.7 billion) next year and 257 billion rubles in 2014 from lower import duties as a result of membership in the WTO, Economy Minister Andrei Belousov said today. The government won the right to channel as much as $9 billion a year in agricultural subsidies, which exceeds the farming industry’s real needs, Belousov said.
Russia’s entry into the organization will add about $162 billion each year to economic output over the long term by improving market access and luring foreign investment, the World Bank said in March. WTO members carry out 97 percent of global trade, according to the World Bank.
“We welcome the process and expect sizable gains from the entry in the medium term, in particular further economic liberalization,” Julia Tsepliaeva, head of research at BNP Paribas in Moscow, wrote by e-mail after the vote. “However, the first impact of the entry is likely to be negative as competition with imported goods and services is likely to substantially increase.”
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