Russia may pull out of trade deals

Cattle Market & Farm Reports, Editorials
Aug 29, 2008
by DTN

Russia may pull out of trade deals

Amid fraying trade relations between Moscow and Washington, Russia said it would slash U.S. import quotas for chicken and pork, both big export products to the region from the U.S, reported the Wall Street Journal.

After U.S. officials said Russia’s war with Georgia had cast doubt on Russia’s bid to enter the World Trade Organization (WTO), Prime Minister Vladimir Putin last Monday called for pulling out of trade deals that Russia had signed when it was expecting quick admission into the trade body.

Then Russian Agriculture Minister Alexei Gordeyev said last Wednesday that Moscow plans to reduce quotas for imports of chicken and pork by "not tens but hundreds of thousands of tons."

Russia has helped the American meat industry grow for the past decade. Russia was the biggest importer of U.S. chicken meat in 2007, spending $741.5 million on U.S. imports, according to the USA Poultry and Egg Export Council.

In 2005, the U.S. and Russia entered into an agreement that allowed U.S. producers of poultry, pork and beef to export a specified quantity of product to Russia at a lower-than-usual tariff. That agreement, which was extended through 2009, was a way for Russia to bolster its free-trade credentials ahead of WTO accession talks.

Russian officials now say WTO membership is a long way off—Western officials have called for blocking the talks to punish Russia for its war with Georgia—and so observing the deals is no longer in Russia’s immediate interest.

Officials at the Office of the U.S. Trade Representative (USTR) say they haven’t been officially notified of Russia’s decision to cut some meat import quotas.

"If Russia decides to step back from those ... commitments, that will obviously further delay its aspirations to join the WTO," said USTR spokesman Sean Spicer. — DTN

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