WTO, Russia and consensus
03 November, 2011
WTO, Russia and consensus

 

Russia will enter the World Trade Organization only through consensus and Georgia had better not hamper it, some Georgian experts think. Some presume Georgia has already made huge concession and Russia should agree if it really wants to join the global trade club. Yes or No – these two words are between Russia and the WTO at the moment; they will decide the 18 year-long WTO bid.

Georgia’s potential veto power, the last remaining obstacle to Russia’s accession to the WTO, is

removed actually as Georgia accepted concession suggested by the Swiss side on establishing international control instead of Georgian customs officers, and Russia should say “yes” as well if it really wants to join the WTO before the end of the year, a goal set by Moscow and Washington.

The talks had snagged on how to monitor trade that crosses from Russia into Georgia’s breakaway republics of Abkhazia and South Osetia. The question became acuter since the brief war the two countries fought in 2008 after that Russia formally recognized Abkhazia and South Ossetia as sovereign nations.

The WTO accepts members through a consensus system, meaning that Georgia, which joined in 2000, can block Russia if it does not accept the Swiss proposal made at the latest round of negotiations between Georgia and Russia in Geneva on October 25-26, 2011.

The Swiss compromise says private firms will place observers on both the Russian and Georgian sides of the border — though not inside the enclaves — to monitor cargo. The contractors will be hired by neutral third parties [tentatively Switzerland].

After a serious international pressure preceding the latest round, Georgia agreed on the Swiss proposal, calling it the final compromise.

“This is the last compromise we have made and if Russia does not accept it we will not go for more concessions, there is no time left for negotiations,” Sergi Kapanadze, Deputy Foreign Minister of Georgia, who leads Georgia’s delegation at the talks, told Georgian Journal.

However, Russia took a week-long time-out, thus pending its final say till November 9-10 when the last round of negotiations is scheduled. The uncertainty laid ground to speculations and surmises.

Soso Tsiskarishvili, a political-economic scientist presumes Russia will accept the Swiss proposal if it finds it apt in the pre-presidential-election period in 2012.

“WTO brings benefits in long-term prospects while an immediate aftermath is reduction of employment and deterioration of social picture. It is certain jeopardy before elections so they will weigh all pros and cons and if find unsuitable to join WTO at the moment Moscow will say ‘No’ and blame Georgia,” he said, adding that if Moscow turns down the deal, Georgia should not make any more compromise, because admitting of international monitors at the internationally acknowledged economic borders of Georgia instead of Georgian customs officers, is already a huge compromise.

The WTO could technically admit Russia through a vote of the majority; that type of accession has occurred only once in the early phase of the organization’s history. But Russia as a big global power wants to hold its international image high and join the trade club only through the way of consensus.

“The basic WTO principle is consensus, all countries but one exception went through this way and it is not prestigious for Russia with its international reputation and image to enter the WTO otherwise than consensus. Theoretically the WTO regulation makes possible that trade relationship between two certain countries [Georgia and Russia for example] would not be regulated by WTO rules but we do not want this. We want to follow the way of consensus,” Aleksey Portansky, Director of Information Bureau on Russia’s WTO Entry at High School of Economics, said on November 1, 2011 at the video-bridge dedicated to Georgian Russian WTO talks.

Demur Giorkhelidze, an economic analyst, believes Russia will  join the WTO only through  consensus and Georgia should not hamper this as Russia’s WTO entry is a part of big international political game.

“We should consider the deal pragmatically: if Russia joins the WTO the trade embargo will be automatically removed, all product quality suspects will be settled through the WTO dispute council and politicians can no longer block trade deals. On the other hand Georgia’s veto power is a mirage. Russia’s WTO entry comes in the interest of all big international players, they have already agreed on this as Russia is a decisive factor to control situation in Afghanistan and Middle Asia that is so important today. And Georgia has no power to block decisions made on such levels, and it should not block it for it will be placed in more complicated political situation,” Giorkhelidze told GJ.

He believes Russia is ready to join the WTO this year and if Georgia hampers its consensus-based integration Russia will undertake more severe policy toward Georgia as well as the US and EU since they guaranteed Moscow to get within the WTO this year.

“Situation is that if Russia says no to the Swiss proposal Georgia will be forced to make step back again, it is more prudent. Russia’s WTO membership can be a step forward to start regulation of other relationships between Georgia and Russia,” Giokhelidze said.

 

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