Mandelson In Russia For Talks On WTO Accession

By Ulrika Lomas, for LawAndTax-News.com, Brussels

24 June 2008

EU Trade Commissioner Peter Mandelson is in Moscow on Thursday for meetings with key members of the new Russian administration, ahead of the EU-Russia Summit on the 27th of June.

He will meet with First Deputy Prime Minister Igor Shuvalov, Deputy Prime Minister and Finance Minister Alexei Kudrin, and Minister for Economic Development Elvira Nabiullina.

He will also meet with the Russian Union of Industrialists and Entrepreneurs.

The talks will focus on Russia's WTO accession, and also deal with other bilateral and multilateral trade and economic issues. Mandelson will also deliver a speech on the future of EU-Russia relations to a high level conference in Moscow.

On the visit, Commissioner Mandelson commented:

"I remain optimistic about the opportunities ahead for the EU-Russia partnership. Economic liberalisation and convergence will form the bedrock of that partnership. We need to create a strong, overarching framework and we need to see Russia in the WTO. "

The EU has repeatedly argued that Russia's WTO accession is in the interests of Russia's economic goals, especially its increasing external economic interests. Accession is also in the interests of the global trading system, with Russia the only economy of any size outside the WTO.

Substantial progress has been made in bilateral talks and Russia's accession is within reach. For the EU there are only a few remaining outstanding issues that need to be solved, notably the issue of export duties, including those concerning exports of wood.

While in Moscow Mandelson will deliver a keynote address to a conference entitled "Russia in the 21st Century", where he will argue that the EU and Russia need to think clearly about the strategic dimension of their common interests in order to make the relationship more effective. Mandelson will argue that economic convergence and closer business ties will facilitate a closer political partnership.

EU exports to Russia in 2006 amounted to EUR72.4bn - mainly machinery and chemicals – and represent 6.2% of EU exports. EU imports from Russia in 2006, amounted to EUR140.8bn Euros, mostly concentrated in the energy and minerals sectors.

This represents 10.4% of EU imports. Provisional statistics for 2007 show a 26% increase in EU exports over the first 9 months of the year, but a slight decrease in EU imports.

The EU is by far Russia's biggest trading partner and source of investment – it receives more than half of all Russian trade.

Although EU-Russia trade is growing, it remains overwhelmingly focussed on energy goods and the energy industry.

Opportunities for EU trade and investment in Russia are limited by an uncertain business and political climate and barriers to imports.

Closer EU-Russia economic integration would facilitate investment and help diversify the Russian economy, bring greater stability to economic ties and encourage the development of small and medium-sized businesses in Russia.

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