Georgian script for the WTO…

By Ilona Raskolnikova:

Russia is not too eager in the WTO, but it’s so funny to watch for Georgia, which imagines itself the mistress of the situation. Mikhail Saakashvili should understand that today he is playing exactly the role that is very suitable for the Russian Federation.

Despite the fact that the United States have completed their negotiations with Russia on the WTO accession, the European Union has long remained a stumbling block. Yes, it was a continental union, not Georgia, screaming at every corner that trade fate of Moscow is in their hands, stood in the way of the Russian authorities. The reason is simple – duties on roundwood and Siberian overflights did not give rest to Europeans. But during the recent negotiations between the EU and the Kremlin, all the obstacles were removed.

Moscow does not like Chicago Convention on International Civil Aviation Moscow, since it is not possible to resolve the issue with the payments till 2013 – the scheme is too complicated. Because compensation payments to Russia each year are carried out by some twenty foreign airlines, which compensate the country’s loss of profits from non-stop flights from Europe to Southeast Asia. This, according to various sources, amounts about $ 420 million. Cancellation fees will deprive the Russian budget of additional revenue items.

Brussels was very loyal on the other issues. It managed to negotiate with Russia on a new mode of industrial assembly at productions, extending this provision to the major car manufacturers, but only for a transitional period, while the integration in the WTO. After that all the arrangements will cease to act to avoid compensations to the EU due to leakage of personnel in Russia. In return, Moscow would reduce duties on exported cars and spare parts of foreign manufacturers, and foreign cars would become more affordable. In this case it’s not difficult to imagine what is waiting for the domestic auto industry and other industries, if we follow such a scenario.

Thus, it becomes clear that the pull of Russia into the trap of the World Trade Organization can last almost indefinitely, as long as both parties do not get tired of inventing new reasons and rules in order to the general laws of the international trading community could operate at Russian territory. So, which is the role of Georgia in this. It is surprising, but the role of Tbilisi in the negotiations on the WTO is very high, but they will fulfill it according to the Kremlin’s script. Since the trading part of the debate had long been resolved, diplomacy and geopolitics, that is “territorial integrity” of Sakartvelo, appears at the stage.

Tbilisi demands to establish control of the movement of goods at the Russian border with South Ossetia and Abkhazia, as they still consider them their own enclaves. But Moscow has recognized their sovereignty in 2008, and can not afford to track its trade turnover with the independent states. And in this case the talks always reach an impasse, because according to the law both sides are right, but on the content even the world community has no certain position, which made Switzerland to become mediator between the Kremlin and Sakartvelo.

So what a compromise can be achieved, provided that Russia really wants to join the WTO on their own, and not on the factor of restart policy between Russia and the United States? If Moscow and Tbilisi do not achieve agreement, and patience of those, who is interested in Russia’s joining, will run out, there will be used a voting procedure. And in this case, the diplomatic defeat of Georgia is inevitable, because then the accession of its northern neighbor will happen bypassing them. Moreover, a part of the international community de facto recognizes the new borders in Caucasus, drawn in August 2008.

The Republicans, in anticipation of these events, have already written a lengthy letter to Secretary of State Hillary Rodham Clinton and the U.S. Trade Representative Ron Kirk, urging the administration to fully consider the interests of Georgia before giving its consent to Russia’s accession to the WTO. However, considering that now the head of the White House is Democrat who is not going to give up his positions in the upcoming presidential elections in 2012, it is doubtful that Obama will listen to his rivals.

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