On Tuesday, Russia’s parliament ratified the accession agreement that will allow Russia to join the World Trade Organization (WTO). The State Duma voted 238-208 to pass the bill. The ratification must now be approved by the upper house next week, and signed into law by President Putin before the July 23 deadline.
Then, after a final 30-day waiting period, Russia will become a WTO member. Russia was officially invited to join the WTO last December, after 18 years of negotiating the terms of its accession. Senate Finance Committee Chairman Max Baucus released this statement about Russia’s action.
Russia will be a full WTO member in mid-August, and all WTO members will automatically benefit from the concessions and tariff reductions that Russia agreed to – except for the United States. To take full advantage of Russia’s WTO membership, Congress must to repeal a Cold War-era trade restriction intended to ensure the Soviet Union allowed religious emigration. The so-called Jackson-Vanik Amendment requires annual certification of Russia’s emigration policies. Without unconditional Permanent Normal Trade Relations (PNTR), Russia will not be required to grant U.S. companies the same WTO benefits as competitors from other countries.
Manufacturers of all sizes will benefit greatly from PNTR with Russia. More than 80 percent of the approximately 5,000 U.S. companies that currently export to Russia are small or medium-sized firms. In fact, small and medium businesses account for nearly half of all U.S. exports to Russia. These businesses exported $2.1 billion of goods to Russia last year. Those exports could reach $4.2 billion by 2014, according to some estimates.
You can learn more about benefits of PNTR for manufacturers at the NAM’s new web page on Russia PNTR, with resources and information about PNTR with Russia. You can also take action and contact your Congressman or Senators here.
Lauren Airey is director of trade facilitation policy, National Association of Manufacturers.