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Bush Urged to Be Cautious of Russia Joining WTO

By Paul Blustein
Washington Post Staff Writer
Thursday, July 13, 2006

On the eve of the Group of Eight summit in St. Petersburg, business groups and members of Congress are warning the Bush administration not to rush into a deal with Russia over one of Moscow's cherished goals -- entry into the World Trade Organization.

In a letter to President Bush that was released yesterday, 20 Democratic senators voiced their "serious concerns . . . that the United States may be poised to finalize" an accord with Russia "while numerous issues critical to U.S. agriculture, manufacturing, high tech, intellectual property and services industries remain outstanding."

The admonitions come as top U.S. and Russian officials are hunkered down in last-ditch efforts to reach an agreement on Russia's WTO membership that could be announced during the G-8 summit this weekend. In an indication that the negotiations are reaching an intense stage, U.S. Trade Representative Susan C. Schwab has joined the talks.

"We landed in Moscow this morning and are currently in meetings with our Russian counterparts (and the night is young)," Sean M. Spicer, a spokesman for Schwab, said yesterday in an e-mail. "While there has been progress in many areas, we still have several issues that need to be resolved. We remain hopeful but there is not a deal at this point."

Joining the WTO has been a priority of Russia for years. Membership in the Geneva-based trade body, which sets the rules for most international commerce, would protect Russian exports against arbitrary sanctions by other countries.

The United States is the only nation among the 149 members that is balking at approving Russia's entry, in part because of concerns that the Russian economy is still autocratically run with too much favoritism shown to state-run companies and other powerful interests. U.S. business groups and policymakers are also upset about Russia's use of food safety rules to block imports of American meat and poultry, and the rampant pirating of music, movies and other forms of intellectual property in Russia. One fear is that Russia would follow the path of China in failing to crack down on the piracy problem once it gains WTO protection. China joined the WTO in 2001.

The Bush administration's stance has been a major source of irritation for President Vladimir Putin and his government, which complains that Russia is being held to a higher standard than other countries. In an effort to prod the United States into a deal, Moscow has played hardball by holding up bids by American companies, including ConocoPhillips Co. and Chevron Corp., to drill for natural gas in a major field in the Barents Sea.

U.S. officials, while expressing the hope that WTO membership will advance the rule of law in Russia, have vowed that they will insist on tough terms. They say they are keenly aware that any deal must pass muster in Congress, which would have to lift Cold War restrictions on U.S.-Russia trade as part of an agreement.

But those assurances have not entirely soothed Moscow's critics. In May, the Republican and Democratic leadership of the Senate Finance and House Ways and Means committees sent a letter to the White House declaring that "Russia has not sufficiently demonstrated the sound trade practices essential" for WTO membership.

Late last week, a letter sent by a coalition of major business groups, including the U.S. Chamber of Commerce, the Motion Picture Association of America and the National Association of Manufacturers, voiced hope that a pact on Russia's WTO entry "will not be concluded until such time as Russia has demonstrated that it will be a reliable partner in the global trading community."

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