POUR EN SAVOIR PLUS:
Examen des politiques commerciales: Fédération de Russie
This is the first Trade Policy Review of the Russian Federation since its accession in 2012. Therefore, as some delegations have pointed out, it is the first opportunity for Members to learn about developments in the Russian Federation's economic and trade policies since then, and to review the country's participation in the multilateral trading system as a Member of the WTO.
During this 2-day meeting, we have had a useful discussion, thanks to the contributions from the head of the Russian delegation, Mr. Maxim Medvedkov, Head of the Department for Trade Negotiations of the Ministry of Economic Development; our discussant, Ambassador Vangelis Vitalis from New Zealand; and the 53 delegations that took the floor.
This Review took place at a time when the Russian Federation faced a challenging economic environment. While the sharp decrease in GDP might had stabilized and growth was expected to resume next year, the recovery seemed slow and modest. During the discussion, Members noted that the fall in oil prices, the sanctions imposed on the Russian Federation by some countries, and the counter measures taken by the Russian Federation were among the main reasons for the contraction in the economy. There were ongoing structural reforms to diversify the economy and reduce reliance on hydrocarbons. However, several delegations stated that more could be done, given the high level of education, excellence in technology, and the wide range of resources available in the Russian Federation.
Members had a frank exchange on how the Russian Federation's trade policies could best be oriented to make a difference. More specifically, several Members noted that the Government's response to the economic crisis had focused on three principal measures, namely: a fiscal stimulus; the floating of the Rouble by the Central Bank; and import substitution. While the first two were viewed favorably in general, some delegations questioned how the third could align with the basic principles of the WTO. They pointed out that policies based on this objective would undermine trade liberalization efforts and discourage competition, which would be detrimental to sustainable economic growth.
From the trade policy perspective, this is also an interesting time for a review, because the expanding roles of the Eurasian Economic Union and the Eurasian Economic Commission mean that many policies and practices are now decided and applied at a regional rather than national level. Examples include the common external tariff, the development of a new customs code, negotiation of free trade agreements, and the investigations and application of contingency measures. During this Review, many Members sought further information on the policies of the Union and the legal competence of the Commission.
Commenting on its participation in the WTO, most delegations acknowledged that the Russian Federation was an active Member, and had made significant contribution to multilateral negotiations. Many highlighted the considerable progress that the Russian Federation had made in liberalizing its trade regime both before and after accession to the WTO. The Russian Federation was commended in particular for its ratification of the Trade Facilitation Agreement, tariff reductions, simplification of customs procedures, participation in the Information Technology Agreement, as well as improvement to its intellectual property legislation.
As noted by many delegations, these reforms had helped the Russian Federation move up quickly in the World Bank's Ease of Doing Business index. In addition, the country was recognized for having met many of its notification requirements, and indeed for being one of the only four developed country Members that had updated its notifications on domestic support and export subsidies for agriculture. However, several notifications were still outstanding, including those on state-trading enterprises.
Some Members expressed concern about the local content requirements that the Russian Federation applied to its government procurement and state-owned enterprises. These requirements could be particularly trade distorting, given that the state was heavily involved in the economy through the companies that it owned and controlled, which altogether represented over half of the country's GDP and dominated key sectors such as banking, transport and energy. Many Members suggested that better governance of these companies, restarting the stalled privatization programme, along with accession to the WTO Government Procurement Agreement could help improve transparency, reduce distortions and stimulate growth.
Several delegations were particularly concerned about the Russian Federation's use of SPS and TBT measures that were apparently not based on international standards, as doing so had created considerable trade barriers for them. Furthermore, they were concerned about restrictions on import to the Russian Federation and on the transit of goods through the Russian Federation to other countries, which had greatly reduced trade. They were of the view that the lack of transparency and predictability in the administration of these measures had posed additional difficulties for their traders.
Many other issues were raised during our discussion, including fossil fuel subsidies, fisheries subsidies, use of contingency measures, efforts in fighting corruption, the use of non-ad valorem tariffs, and incentives conditional on strict localization requirements.
The Russian delegation has taken the opportunity of this Review to explain its economic strategies and foreign trade policies. It had also responded in detail to Members' comments in the key areas. It acknowledged the systemic trade and economic challenges that the country was facing, and found solutions in export diversification, development of domestic high-tech industries and of small and medium-sized enterprises, as well as exploring new opportunities in foreign markets for trade and investment.
The delegation affirmed the Russian Federation's strong support for the multilateral trading system and its adherence to WTO rules. It underlined the country's determination to continue playing an active and constructive role in all areas of WTO activity, and looked forward to developing mutually beneficial trade and investment relations with other WTO Members.
Overall, the active participation of Members during the two sessions and the large number of advance written questions are testimony to the importance of this exercise and of Members' interest in the Russian Federation's trade policies. This Trade Policy Review will be completed within the next month when the Russian Federation has replied to all outstanding questions.
Although the Russian Federation is facing a challenging economic environment, it also has many advantages in minerals, hydrocarbons, agriculture, forestry, fishing, and, most importantly, human resources. I hope an open and transparent trade and investment regime, reinforced by good policies based on WTO principles, commitments and rules, would help the Russian Federation maximize its growth potentials and contribute to the multilateral trading system.