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Saturday, 22 October 2016


Wine in exchanged for WTO: to be bargained over?

2010-07-15 16:56

6372.jpegIn vino veritas is an ancient saying so deeply entrenched in the heads of US politicians. Now relations with Russia, a great empire, that persistently fails to join WTO are associated with Georgian alcohol and bargained over like at a Tbilisi bazaar. US Assistant Secretary of State for Europe and Eurasia Phillip Gordon stated on his visit to Tbilisi: "Russia's accession into WTO is important to US economy, to global economy and to the Russian Federation". Gordon emphasized though that before accession Russia must solve a number of economic issues with Georgia, already a member of this trade organization, referring to lift of embargo on imports of Georgian wines, mineral water and


other products.

Well, why not open a chain selling Georgian wines in US major cities - if there is so much concern? Can it be done? Course not. We're just made to see who the boss is.

Georgia states it won't change its conditions for approval of Russia's WTO accession. In particular, official Tbilisi urges the RF to ensure joint control over customs posts in Abkhazia and South Ossetia and calls to lift embargo on Georgian produce.

Tbilisi's just itching to get through to Abkhaz and South Ossetian borders though it has nothing to do with the trade. And blackmailing Russia has grown into a hobby. Ok, small but pride country. You have done enough harm. Five years ago everyone was sure that Russia would soon melt in an economic ecstasy with global economy. Our ministers kept assuring that WTO accession is a determined issue. It was not, though. Talks with the USA - the last country blocking our entry into WTO - have led to nothing. And year after year still fewer Russians grasp the meaning of the situation: there are both favorers and opponents of the country's WTO accession.

Opponents set forward economic arguments believing that after the entry Russia will lose whole industries of its economy and consequently millions of jobs because of uncompetitiveness of its goods. According to the information by the Union of Russian Commodity Producers Russia's accession into WTO and duty-free trade will flood the country with imported goods leading to shutdown of over 40 thousand enterprises and 30 mln unemployed - a half of the country's work force. Experts estimate that Russian engineering industry will be affected the most since the goods are most often non-compliant with the global market requirements as confirmed by an extremely low exports rate. It is impossible to be a competitor to the West without restructuring and reforming Russia's engineering sector and other industries based on considerable state support.

For Russia's accession into WTO it is necessary to ensure food security first of all. It is not a secret that stars and stripes want to get rid of their GMP and thus ruin our agriculture under the WTO flag.

It is well-known how Western companies seek to conquer Russia's domestic market. To do that they offer dumping prices ousting local manufacturers and stopping our production and then raise prices when the monopoly status is acquired. Foreign states call Russia to decrease state support for agriculture for WTO accession as well as to lower customs duties for imported goods. In our view, these demands don't look at all fair.

For instance, EU countries annually allocate USD 42 bn in support for agriculture - 50 times higher than in Russia which demands to leave state support of agriculture at the level of USD 16 bn. Now Russia spends less than USD 1 bn on agriculture. But WTO wants to lessen even this small amount to flood us with goods that fail to be sold elsewhere.

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