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Russia: The WTO Is Next, The Question Is When?

Denver, Colorado; 23 June 1997 (RFE/RL) - Russian President Boris Yeltsin told reporters at the Summit of the Eight in Denver Sunday that Russia "must be in" the World Trade Organization (WTO), and he thinks it "will happen this year and not in 1998."

U.S. President Bill Clinton promised Yeltsin at their March Helsinki meeting that America would try to help Russia get into the Paris Club of official creditors by the end of 1997 and into the WTO by the end of 1998.

Agreement on Russia's membership in the Paris club was worked out early last Friday morning and announced with a flourish at the summit. While the announcement beat the year-end goal, it is apt to take at least six months for each of the current 18 club members to approve Russia's entry.

Even then, Russian officials talk as if achieving Paris club cleared the last hurdle to the WTO and that Clinton's promise to try to get Russia there within two years is a guarantee.

The Russian government's leading reformer, First Deputy Prime Minister and finance Minister Anatoly Chubais, told reporters at the Denver summit the agreement with Clinton would be implemented, but cautioned that Russia would not accept just any conditions.

"We won't accept any discriminatory attempts," he said, "We insist the approach to Russia must be the same as is shown to any country entering the WTO."

Chubais said that Russian officials were not very pleased with their first substantive negotiations with the delegation from the European Union (EU). Different members of the WTO handled different aspects of the negotiations with candidate members while the WTO itself coordinates the overall approach.

"The first step of negotiations made us cautious," said Chubais. "For the time being, we're not in a position to tell you we are satisfied with the position of the European Union regarding major issues."

He said Russia is instead looking forward to the next round of talks with the United States and Japan, where Moscow feels it will get a better deal.

But getting into the WTO is not that easy.

The summit final communique supported "the goal" of Russian accession to the WTO "on the basis of conditions generally applicable to newly acceding members."

Sir Leon Brittan, the EU Vice President who led the delegation to the Moscow talks a few weeks ago, smiled when told of the Russian comments.

"We support Russia's membership under proper conditions, of course," he said.

"Russia is moving in the right general direction," he added, but Moscow is at an "early stage of the process" and has "a long way to go."

Brittan says the EU delegation went over what current members "consider reasonable for market access for goods and services," with Russian responses called for at the end of the summer.

But this is a highly complex area of trade negotiations, officials point out, and Brittan said it was "a mistake" for the Americans and the Russians to put a date on projected membership. It's far more important, he said, for Russian leaders to concentrate on the difficult work that must be done to meet all the requirements for membership in the trade organization.

Officials at WTO headquarters in Brussels say privately that it will take something akin to a miracle to complete Russia's accession negotiations by the end of next year. Even after the government negotiates specific details, it will require passage of a huge amount of legislation by the Russian parliament. The country's laws on everthing from tariffs to finance to dispute resolution must be harmonized to match the global system -- new laws that will, at the very least, be controversial in the communist controlled Duma.

Still, Chubais says the benefits of WTO membership for Russian citizens are very important. The concept seems "abstract," he says, but for example, there are non-member "quotas in the WTO on the export of goods from Russia, including textiles, and this is not abstract but directly affects the real standard of living of tens of thousands of people" living in major textile producing areas around the country. It makes a difference, he said, in the wages they receive or don't receive.

If he does not completely understand how much lies ahead yet in negotiating WTO accession, say western officials, Chubais at least knows that the biggest selling job will be to the people -- and government -- at home.