Georgia deal opens WTO doors for Russia


Russia is set to join the World Trade Organisation (WTO) by mid-December 18 years after seeking membership. The last obstacle was lifted yesterday (3 November) when Georgia, with which Russia fought a brief war in August 2008, withdrew a veto over its big neighbour's accession.

Russia is ready for a compromise solution to its longtime bid to join the WTO, President Dmitry Medvedev told reporters on the sidelines of the G20 summit in Cannes.

Medvedev did not provide details but said his country was prepared to take up "some of the compromise ideas" elaborated with the help of Switzerland.

Switzerland initially served as a go-between in Russia’s WTO talks with Georgia, but in 2008 Tbilisi pulled out of the talks after its brief territorial war with Russia.

Russia and Georgia on Wednesday reached agreement on cargo monitoring on the Abkhaz and South Ossetian borders, the last hurdle on the country’s way to joining the WTO.

Georgian Deputy Foreign Minister Sergi Kapanadze, whose country broke off diplomatic relations with Russia, told Interfax news agency: "Everything should reach its conclusion … by the 10th of November."

This is the date for a meeting of a WTO working group which can then draw up a final document for approval by WTO trade ministers in Geneva on 15 December.

The Civil Georgia website quoted the country's President Mikheil Saakashvili as saying on Thursday that the WTO deal with Russia was a "diplomatic victory" because for the first time after losing control over Abkhazia and South Ossetia in the early 1990s, Tbilisi would be able to gain access to information about movement of cargo at those border sections.

According to the Swiss-mediated deal between Russia and Georgia, a private company hired by Switzerland will monitor trade at the three border crossing points – two of them in Abkhazia and South Ossetia and a third one at the Zemo Larsi-Kazbegi border crossing point, an undisputed section of the Russian-Georgian border. [More details here].

Saakashvili said it would be the first time in nearly 20 years that the Georgian government would have information about all the cargo entering Abkhazia and South Ossetia. The Moscow Times publishes a breakdown of how entry into the WTO will affect some of the biggest sectors of the Russian economy [More details here].

Abkhazia and South Ossetia have been a source of tension between Russia and Georgia since the fall of the Soviet Union in 1991.

European Commission President José Manuel Barroso welcomed the announcement of the agreement on Russia’s WTO accession. "Russia is the EU's third largest trading partner and a very important market for EU exporters and investors. Russia's WTO accession would bring a real qualitative change to the current trade regime," Barroso stated.

Barroso paid tribute to "the flexibility shown by both Georgia and Russia" to find a compromise and encouraged both parties to overcome the very last technical hurdles in order to formalise the deal.

Barroso also praised "the hard work, persistence and creativity of Switzerland in their mediation effort between the parties".

Russia is the largest country outside the 153-member World Trade Organisation (WTO). It has been trying to join the WTO since 1993. 

At the December 2010 EU-Russia summit the two parties signed a memorandum of understanding to settle bilateral issues regarding Russia's WTO accession.

Since 2009, the EU and Russia have been able to remove stumbling blocks in difficult areas such as Russian exports of timber, beef imports to Russia and overflights over Siberia.

One of the key obstacles for the European Commission was Moscow's plans to put in place a customs union with its ex-Soviet neighbours Belarus and Kazakhstan.

But this is no longer seen as a problem in Brussels.

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