Russo-UE struggle in WTO

| Foreign Markets |

One of the major economies of the world has recently become a member of the World Trade Organization. We have already mentioned the fact that Russian Federation was accepted to joined the WTO. Let us have another look at this historic event, this time from a slightly different perspective.

The inclusion is undoubtedly one of the most serious moves towards liberalization of global trade. In our opinion, the changes in the Russian legal system will take place gradually. The changes are bound to influence both the gas and the petrochemical market, as well as the fertilizers-chemicals sector. Being one of the major players on the fertilizers market in Europe, we have been closely following the activity of Russian companies, especially since Russia joined the WTO.

Russo-UE struggle in WTO/fot. freepik.comThe positive aspect of presence in WTO

The largest country in the world joining the WTO is a major issue for our business. However, it does not mean that the trade barriers have been lifted automatically. Representatives of trade companies are actively monitoring the observance of rules which are in force in WTO member states. By decreasing the import duties and simplifying the procedures of commercial exchange, we have become direct competitors of Russian chemical companies. This is particularly important in the context of making the prices of our products competitive with prices set by the Russians.

Additional norms

Apart from the norms regulating commercial exchange in the WTO, additional restrictions have been imposed on Russia. Those are supposed to protect the EU market. In particular, the restrictions secure the EU enterprises from unfair competition, which might be caused by the limitation of import duties combined with lower manufacturing costs and less demanding standards of environmental protection.

Russo-UE struggle in WTO/fot. freepik.comThe norms concern:

* the price of gas in Russia – Russian manufacturers and distributors of gas have been obliged to sell the fuel to domestic industrial users at a price which covers the cost of manufacturing, maintenance, investment and which allows them to make a profit

* transparency and monitoring of economic policy in Russia – the authorities of the Federation ought to take it upon themselves to improve the predictability of commercial conditions for European entrepreneurs and investors.

Enumerating all the consequences of Russia joining the World Trade Organization will only be possible in a few years’ time. Until then, we had better concentrate on preparing adequate strategies of fair competition with Russian business entities, especially by making our offer attractive on the global market.