Russia’s 19-year wait to become a member of the World Trade Organisation is finally over.
Some economists and politicians believe the country could be transformed with the economy boosted by foreign investment.
However many smaller entrepreneurs fear an end to import tariffs will mean their customers will switch to more attractive foreign products.
Dmitry Sredin, a senior executive with Russia’s biggest bank Sberbank is optimistic. He said: “Russia’s accession to the WTO is definitely a positive signal for all Western investors, a positive signal for all companies that work in the Russian economy. We expect mid- to long-term economic growth from this.”
The theory is the protocol signed last December and now in effect will make Russian companies more efficient and productive.
But even the head of the WTO, Pascal Lamy, admitted there will have to be changes: “Today, Russia joins the World Trade system with an export structure, which is still heavily concentrated on fuels and minerals, that represent more than two-thirds of Russian exports. This should be an important contribution to the future diversification of Russian exports.”
With its exports dominated by oil and gas, which are not subject to tariff barriers, Russia can’t expect the kind of boost that China enjoyed from WTO membership.
Moscow’s timing is also not good with much of the developed world in recession.