In December, Russia reached agreement with the World Trade Organization and its members – including the United States and European governments – on the terms of its accession. All that remains is for the Duma, or parliament, to ratify the accord. While Putin has been somewhat skeptical of WTO accession, there is no other choice for Russia if the new government wishes to modernize an economy that’s overly dependent on oil and gas exports.
The US and Europe should push Russia to complete its entry into the WTO and then begin close monitoring of its implementation of trade rules. As with China, the process of adopting and enforcing those rules is likely to be slow. Just as the US and European Union pushed together for Chinese adherence to WTO rules on protection of intellectual property, so they must cooperate closely to gain Russian adherence to those rules and others.
WTO membership presents a valuable opportunity to strengthen rule-of-law in that country – including laws on contracts, property ownership, and investment protection. The US and EU should also support Russian organizations, including business associations, that seek to make WTO membership an effective and practical reality.
If the US is to have any credibility in this effort, it must finally repeal the Jackson Vanik amendment of 1974. This relic of the cold war no longer serves any real purpose, as the Soviet Jews it sought to protect have long since emigrated. But by keeping US barriers to Russian trade abnormally high, Jackson Vanik ensures that the US – and US-based companies – will be at a serious disadvantage as Russia expands its global trade.
Repealing Jackson Vanik should not be seen as a favor to the new Russian government. Opening markets to Russia is essential to convince the Russian public and business leaders that their future is with the West. In return, US business will have better access to a growing economy and consumer market.