Russia’s WTO Accession May Open Political Pandora’s Box in Moscow

Russia’s WTO Accession May Open Political Pandora’s Box in Moscow

In a significant foreign policy breakthrough, the Russian Duma voted last week to ratify the country's accession to the World Trade Organization, resolving an issue that had been a point of contention between Russia and the West since the 1990s. Russia's accession negotiations, which opened in 1995 and were completed in November 2011, were the longest and arguably the thorniest in WTO history. Economic and political disputes, not to mention the Russia-Georgia War of 2008, repeatedly delayed Russian accession. With Russia now set to formally enter the WTO in August, it is worth examining what the move will mean for the country’s internal politics and broader foreign policy.

In terms of concrete policy issues, little will change come August, at least initially. Russia will be required to reduce or remove a number of tariffs immediately upon accession, but Moscow succeeded in securing the right to phase in tariff reductions in key sectors, most importantly agriculture, the automotive industry and civil aviation. Agricultural and factory workers outside Moscow and St. Petersburg make up the base of President Vladimir Putin's support in the country, and protecting their jobs is a priority. It is no coincidence that deputies from the Communist and Just Russia parties used prospective job losses in these sectors to hammer the Kremlin during the Duma debate on accession.

WTO protocols will also require Russia to open up its financial and telecommunications industries, which Moscow might be loath to do. Russia's domestic banking system has been an important means of facilitating domestic corruption by handling illicit financial transactions. And external investment in telecommunications could complicate recent Kremlin proposals for tighter regulation of the Internet. More generally, WTO accession means a political equation that includes more external influences not subject to the Kremlin's influence.

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