Source Pravda.Ru

Russia Joining WTO: Consequences Unknown

International Labour Organization tries to help Russia in determining its position

Since last year, at different levels of Russian authority, disputes on Russian membership in WTO are carried out. Although the government and the main lobbyist of Russian membership in WTO, Economical Development Ministry head German Gref were blamed with indistinct position and with lack of explanations, the authorities still have not shown all pluses and minuses of the possible entry. So, this issue was considered by International Labour Organization: yesterday, in St Petersburg, a trilateral consultation took place, under title Economical and Social Consequences of Russia’s Entry to WTO, in which this organization representatives participated.

To the meeting, high Russian functionaries came: labour minister Alexandr Pochinok, Independent Trade Union Federation chairman Mikhail Shmakov, first deputy minister of economical development Mikhail Dmitriev, Russian Employers Unit coordination council head, Oleg Yeremeev and others. Ironically, economical consequences of Russia’s joining WTO have been never discussed before at such a high level. While this is as important subject for Russia as keeping low internal prices on carbohydrates and electric power.

In fact, Russia again undertook obligation to join WTO till the end of this year. December last year, this was unambiguously declared by the vice Prime Minister, finance minister Alexei Kudrin, when he was in Geneva. Within half a day he spent there, he had time to promise the negotiation process on this issue would be accelerated. While there are still many troubles and ambiguities. A new round of the negotiations is coming, while the government is thinking how to maximally use it. Deputy minister of economical development Maxim Medvedkov, who leads Russian delegation at the negotiations, offered an ambitious thesis: Russia could join WTO already next months. While the question about Russia’s readiness to this step is still without answer. So, the St-Petersburg meeting participants tried to answer it.

To be honest, there are too many questions. For example, how will businessmen and the authority share social and financial responsibility for this step? The Russian Employers Unit coordination council head, Oleg Yeremeev noticed keeping kindergartens, houses, and sometimes the whole infrastructure of some cities and even regions negatively influenced Russian companies competitiveness. Though, the state does not hasten to undertake responsibility for social sphere. The state could gain businessmen at least small indulgences for its support of social sphere. Though, functionaries plead with necessity to pay external debts. In the meanwhile, Russian companies low implication in the work on external market reduces their interest in adaptation of their managers to global market demands. According to some information, about 68 percent of Russian enterprises have nothing to do with production export, while about half of Russian business leaders know nothing about the issue of Russia’s entry to WTO. They seem to support this step, though most of them will be simply thrown overboard by foreign businessmen.

According to Article 7 of Russian Constitution, “Russian Federation is a social state, whose policy is aimed for creation of adequate living standard and free development of a person.” So, the main aim of Russia’s joining WTO must be keeping this principle, while other possible profits of WTO membership – development of market, growth of foreign investments, acceleration of economical growth and so on – are nothing more but means to achieve this aim. The real price of the issue is dozens of millions people’s fates, Oleg Yeremeev said at the meeting.

Does the authority understand, how Russia’s WTO membership would influence social and labour relationship? What does it mean: access to good jobs for many people, effective social protection, confidence in the future, or a social collapse? Serious scientists prefer not to speak about it, while fashionable experts frighten Russian citizens and discuss horrors of economical “intervention.”

According to Oleg Yeremeev, conclusions made by International Labour Organization, correspond in general with researches made earlier by Russian Academy of Science and do not confirm the most apocalyptic forecasts of some experts. Spite serious troubles in different spheres of Russian economy, no catastrophic economical collapse in Russia are to be expected. There will be certainly some problems: for example growth of unemployment in food, textile, footwear, furniture industries and in consumer electronics production. In fact, many fundamental questions still have no scientifically based answers. However, there was nobody, who tried to find this answers.

Akhtyam Akhtyrov PRAVDA.Ru

Translated by Vera Solovieva

Read the original in Russian: http://economics.pravda.ru/economics/2003/7/21/64/7409_WTO.html