In early December negotiators from Russia and the European Union met in Brussels and signed a memorandum on completing bilateral discussions on Russia’s WTO accession.  

U.S. Commerce Secretary Gary Locke, left, smiles with Russian Trade Minister Elvira Nabiullina during a signing ceremony ahead the APEC forum in Yokohama.

The final document, on which both Russia and the E.U. were able to reach consensus ahead of the Russia-E.U. Summit, contains provisions setting forth the procedure for addressing the remaining issues standing in the way of Russia’s accession to the World Trade Organization. Among the most pressing issues that must be addressed prior to Russia’s entry into WTO are such topics as export duties and costs of transporting cargo by railroad lines. 

The memorandum was signed by the Minister of Trade and Economic Development Elvira Nabiullina and the E.U. Commissioner for Trade Karel de Gucht. The agreement was signed immediately prior to the opening of the Russia-E.U. summit.

The negotiations leading up to the agreement were finalized in November, once Russia and the E.U. found common ground on such hot-button issues as export duties on timber. According to inside sources, Russia consented to scrapping earlier plans to raise timber export duties in 2011. It is anticipated that duties on timber will be lowered after Russia joins the WTO.  

According to the Russian government, Russia is expected to join the WTO before the end of 2011.

Still, even though the negotiations with the European Union and the United States are now complete, a number of obstacles remain on Russia’s road to the WTO.

The problems needing attention include subsidies to the farming sector, import quotas on meat products, as well as sanitary and phyto-sanitary inspection requirements.

Further multilateral consultations on Russia’s accession will be conducted in mid-December. The delegates are scheduled to analyze a list of Russia’s commitments in granting access to the services markets. The groups of negotiators will further hear updates to the final report on Russia’s WTO accession and set an agenda for meetings and consultations to take place in 2011. 

Russia has been conducting negotiations to enter the WTO for 17 years. The average wait time for other countries seeking WTO accession is only 5 years. Yet, Russia’s success attained this year, namely the conclusion of bilateral negotiations with the European Union and the United States, is seen as critical to finalizing the accession process. 

The Chairman of the European Commission Jose Manuel Barroso praised the adoption of the memorandum and expressed E.U.’s support for Russia’s plan to join the WTO in 2011. The country’s entry into the Organization will revitalize bilateral investment and may lead to the adoption of a new framework agreement between Russia and the European Union.

The European Union is the largest trading partner of Russia, and it is the number one place of origin for foreign direct and indirect investment. Russia is the biggest energy partner of the European Union and, as such, is its third biggest trading partner, behind the United States and China.