An Opportunity Worthy of a Vodka and Caviar Toast
Last year members of the World Trade Organization (WTO) celebrated the culmination of 18 years of negotiations and invited Russia to join the WTO. Russia is the last major economy to join the world trade body. Its entrance into the international, rules-based trading system, which most of the rest of the world is already in, is cause to celebrate.
Bringing Russia into the WTO will be a win-win for Russia and for the United States. It will help Russia improve and diversify its economy through increased trade and investment and it will help the United States by reducing or removing barriers to US exports. It is estimated that U.S. exports to Russia, which were more than $10 billion last year, could double or even triple once Russia joins the WTO. It will also open up new opportunities for services companies to compete in the Russian market. Finally, it will give the United States a binding dispute settlement procedure that we can use to enforce our trading rights, something we don’t have with Russia now.
In exchange for all of these benefits the only thing the U.S. needs to do is to grant Russia Permanent Normal Trade Relations (PNTR), which means the United States would treat Russia like other WTO members — the basic requirement for all WTO members. In fact, if the U.S. does not grant Russia PNTR status by the time Russia officially joins the WTO later this summer U.S. companies may not receive any of the trade benefits from Russia’s membership – but our competitors in other countries would!
Such a result would clearly be contrary to the U.S. economic interests and would put U.S. companies at a competitive disadvantage. Russia is the 11th largest economy in the world and is now one of the fastest growing economies as well. That’s why it is so important that Congress grant Russia PNTR as soon as possible. As the U.S. continues to face strong economic headwinds we need to take advantage of every opportunity to expand our markets and keep our economy growing. Russia is one opportunity we can’t afford to miss.