Презентация на тему World Trade Organization Accession for Russia

Importance
Russia is currently the largest world economy not a member of the WTO.
What would happen if Russia is cut off from the global economy?

Outline
Russia’s Current Economic Strength
World Trade Organization mission and goals
Advantages to Membership
Disadvantages to Membership
What has been accomplished
What can be expected

Russia’s Current Economic State - Strengths
Source: World Bank

Russia’s Current Economic State - Weaknesses
Inflation
Oil, natural gas, metals, timber
Reliance on oil revenues
Manufacturing
Banking
Political uncertainty
Rule of law

21,000
19,000
17,000
15,000
13,000
11,000
9,000
7,000
5,000
3,000
Jan 2005 Jul 2005 Jan 2006 Jul 2006 Jan 2007 Jul 2007 Jan 2008
CPI Inflation and food prices
Source: World Bank
Return

Oil Revenues
Return
Source: World Bank
Oil’s share in government spending
1997 1999 2001 2003 2005 2007
1995 1997 1999 2001 2003 2005 2007
Oil & gas ranking as a rising share of
total exports
65%
60%
55%
50%
45%
40%
35%
30%
80
60
40
20
0
Oil Dependence
(Oil Share/Total GDP)
Oil prices in US$
Oil spending as % of Total GDP
40%
30%
20%
10%
0%

Russia’s Current Economic State – Signs of Overheating
Inflation
Wage growth in relation to inflation
Wage growth in relation to productivity growth
Infrastructure constraints
Rapid growth in real estate prices
Rapid growth of imports

What is the WTO?
Global international organization dealing with the rules of trade between nations.
Established: 1 January 1995
Location: Geneva, Switzerland
Membership: 153 countries (as of 23 July 2008)
Functions:
• Administering WTO trade agreements
• Forum for trade negotiations
• Handling trade disputes
• Monitoring national trade policies
• Technical assistance and training for developing countries
• Cooperation with other international organizations

Advantages to Accession
Macroeconomic, labor market, and household effects
Liberalization of barriers to FDI in business services sectors
Tariff reduction in goods sectors
Improved market access for Russian exporters

Advantages to Accession
Economy-wide and sector effects
Russia economy will gain due to:
Markets
Resources
Technology
Exports will expand
Regional Impacts
Some regions stand to gain more
Why
How

Return

Advantages to Accession
Poverty effects
55,000 households
Medium term: between 2% and 25% increases in household income
Significant effect by liberalization of FDI in business services

Disadvantages to Accession
Kremlin’s interests are not well served by making the changes necessary to attain WTO membership:
Domestic energy subsidies
Political accommodations
Changed geopolitical landscape since mid-1990s

What has been accomplished
President Putin made WTO accession a priority in his first term.
June 1993: Working party to accession established
March 2006: 30th formal meeting completed
Spring 2007: Russia successfully completed all bilateral agreements

What can be expected
Benefits to Russia of WTO accession come from its own internal reforms, vice increased market access.
25 August 2008: Prime Minister Putin announced that Moscow plans to pull out of some WTO-related agreements.
Possible return of Cold War mentality
Regulatory Agencies and the Judiciary
Organized Crime
Nationalist Movements

Resources
Central Intelligence Agency. The World Factbook. September 4, 2008. https://www.cia.gov/library/publications/the-world-factbook/ (accessed September 8, 2008).
Gaddy, Clifford G. "How Not to Punish Moscow." Brookings Institution. August 23, 2008. www.brookings.edu/opinions/2008/0823_russia_gaddy.aspx (accessed September 9, 2008).
Jensen, Jesper, Thomas Rutherford, and David Tarr. "Economy-Wide and Sector Effects of Russia's Accession to the WTO." The World Bank. May 26, 2004. http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/TRADE/0,,contentMDK:20273889~isCURL:Y~pagePK:148956~piPK:216618~theSitePK:239071,00.html (accessed September 9, 2008).
—. "Telecommunications Reform within Russia's Accession to the WTO." The World Bank. September 15, 2004. http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/TRADE/0,,contentMDK:20273889~isCURL:Y~pagePK:148956~piPK:216618~theSitePK:239071,00.html (accessed September 9, 2008).
—. "The Impact of Liberalizing Barriers to Foreign Direct Investment in Services: The Case of Russian Accession to the World Trade Organization." The World Bank. June 6, 2004. http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/TRADE/0,,contentMDK:20273889~isCURL:Y~pagePK:148956~piPK:216618~theSitePK:239071,00.html (accessed September 9, 2008).
Rutherford, Thomas and David Tarr. "Regional Impacts of Russia's Accession to the WTO." The World Bank. June 23, 2006. http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/TRADE/0,,contentMDK:20273889~isCURL:Y~pagePK:148956~piPK:216618~theSitePK:239071,00.html (accessed September 9, 2008).
—. "Russia's WTO Accession: What are the macroeconomic, sector, labor market and household effects?" The World Bank. 2005. http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/TRADE/0,,contentMDK:20273889~isCURL:Y~pagePK:148956~piPK:216618~theSitePK:239071,00.html (accessed September 2008).).

Resources
—. "Russia's WTO Accession: What are the macroeconomic, sector, labor market, household and poverty effects?" Presented at the World Bank Institute Course "Trade Policy and WTO Accession for Development in Russia and the CIS". Moscow: The World Bank, March 23, 2006.
Rutherford, Thomas, David Tarr, and Oleksandr Shepotylo. "Poverty Effects of Russia's WTO Accession: modeling "real" households and endogenous productivity effects." The World Bank. September 23, 2004. http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/TRADE/0,,contentMDK:20273889~isCURL:Y~pagePK:148956~piPK:216618~theSitePK:239071,00.html (accessed September 2008).
---. "Russia: Dipping into the Revenue Candy Jar." STRATFOR. September 4, 2008. www.stratfor.com/analysis/russia_dipping_revenue_candy_jar (accessed September 9, 2008).
—. "Russia: The Impact -- and Lack Thereof -- of Foreign Direct Investment." STRATFOR. August 13, 2008. www.stratfor.com/analysis/russia_impact_and_lack_thereof_foreign_direct_investment (accessed September 9, 2008).
—. "Russia: Western Businesses and the Return of the Cold War Mentality." STRATFOR. September 2, 2008. www.stratfor.com/analysis/russia_western_businesses_and_return_cold_war_mentality (accessed September 9, 2008).
—. "Russia: WTO, Never Mind." STRATFOR. August 25, 2008. www.stratfor.com/analysis/russia_wto_never_mind (accessed September 9, 2008).
Tarr, David. "Russian WTO Accession: What Has Been Accomplished, What Can be Expected." The World Bank. October 2007. http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/TRADE/0,,contentMDK:20273889~isCURL:Y~pagePK:148956~piPK:216618~theSitePK:239071,00.html (accessed September 9, 2008).
The World Bank. "Russian Economic Report No. 16." World Bank. June 2008. www.worldbank.org.ru (accessed September 2008).
World Trade Organization. World Trade Organization. http://www.wto.org/ (accessed September 9, 2008).