It took nearly 20 years of negotiations, but Russia was finally welcomed into the World Trade Organization on Wednesday.
The largest economy outside the WTO until now, Russia will become the international trade group’s 156th member. The U.S. joined in 1995, China in late 2001. The last member to be accepted was Montenegro in April.
Vanuatu, a small island nation in the Pacific, followed Russia as the 157th WTO member.
“Both accessions show that joining the WTO remains high on the countries’ agendas since trade can bring a predictable and stable basis for economic growth,” WTO Director-General Pascal Lamy said in a statement. “This is especially important as the world goes through troubled times and continues to suffer from one of the worst global economic crisis in memory.”
Russia first applied for membership in 1993. Success now means that President Vladimir Putin, just starting a new term, will likely hold greater sway in international economic dealings.
Membership is expected to bring better trade access and more foreign investment to the country’s roughly $2-trillion economy. Russia’s new stature could result in an additional $162 billion in annual economic output, the World Bank estimated this spring, helping to boost incomes by as much as a 25% for Russian households.
Russia’s membership “will facilitate investment and trade, help to accelerate the modernization of the Russian economy and offer plenty of business opportunities for both Russian and European companies,” according to a statement from Karel De Gucht, trade commissioner for the European Union.
The EU says it is Russia’s top investor and trading partner and said total trade between the two last year amounted to some $383 billion worth of goods. The EU exports cars, medicine, telephones, tractors and more, while Russia -- the world’s largest energy exporter -- sends raw materials such as oil and gas.
A report this week from Capital Economics suggested that Russia’s economy was still slowing, growing at around 3% in the early part of the third quarter after expanding some 5% in the first quqarter. The report touched on concerns that the deceleration was spreading beyond industry to other sectors.
But hitting the brakes may have been a necessary move “to avoid an inflation overshoot” next year, according to Clemens Grafe, chief economist at Goldman Sachs Russia in July.
WTO members are responsible for some 97% of global trade, according to the World Bank.
The WTO also has 28 observer governments, including the Holy See. Countries still angling for membership include Afghanistan, the Bahamas, Iran, Iraq, Libya, Serbia, Sudan and Yemen.
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