WILL RUSSIA, UKRAINE COORDINATE WTO ACCESSION STRATEGIES?

A Russian government spokesman on February 27 announced that Ukraine and Russia will pursue a coordinated strategy for gaining membership in the World Trade Organization (WTO). If correct, this could be another sign of Ukrainian President Leonid Kuchma’s willingness to accommodate Russian economic interests — in order to promote his political future. (See the Monitor, February 27) Should, however, this adoption of a coordinated position lead to the successful conclusion of these negotiations, significant economic benefits could also result both for the two countries and for the WTO itself.

The WTO was founded in 1995 as the successor to the General Agreement on Tariffs and Trade, the body that promoted international trade liberalization and supervised the "rules of the game" in post-World War II international commerce. Although the WTO currently has 130 members, these do not include either China or any of the CIS countries, most of which are currently negotiating their accession as full members. But while developing a joint bargaining position could help the CIS countries maximize their negotiating leverage, such coordination has to date often been seen in other CIS countries as capitulating to Moscow. It is telling that even the "Group of Four" countries (Russia, Belarus, Kazakhstan and Kyrgyzstan) that have been most willing to pursue economic integration have thus far been unable to adopt a common negotiating position in WTO accession. Kazakhstan officials long complained about the absence of such coordination, (Russian news agencies) and on a number of occasions have threatened to negotiate with the WTO on an individual basis.

If accurate, Friday’s announcement by Yeltsin’s press secretary Sergei Yastrzhembsky of a coordinated Russo-Ukrainian position on WTO accession talks (February 27) could therefore signal the arrival of a period of closer economic integration between the two countries. However the politics of such developments are viewed, both countries are likely to benefit from freer trade, less-expensive imports and improved access to OECD markets. Membership for the two largest CIS economies could also strengthen the fledgling WTO.

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