Six-year application to global trading network nears its cli

[MosJan]

Joining the Club: Six-year application to global trading network nears its climax

By Ashot Gareginian

ArmeniaWeek reporter

In the next few months Armenia expects to complete its application for membership of the World Trade Organization.

 

The negotiating process, which started in 1995, is expected to be complete by April or May 2002, opening the way for Armenia to the 144 countries that are already part of the global trading agreement.

 

The final stage of preparation began in October involving multilateral talks with working groups on legislative reforms. They are approaching an end - bilateral negotiations with the 15 biggest member countries are already finished.

 

Experts from the WTO are conducting a last "dress rehearsal" by carrying out detailed research into the Armenian economy.

 

"More than 90 percent of current questions are settled already," says Tigran Davtian, Armenia's Deputy Minister of Industry and Trade, who co-ordinates negotiations with the WTO (pictured).

 

He is hopeful of prompt completion of the final details of membership, but adds: "Everything is far from depending only on us."

 

Armenia recently presented a 100-page "Draft Report" containing a general profile of the current state of the republic's economy. Most of its legislation has already been brought into line with the international standards required for WTO membership.

 

Laws to speed up the licensing and registration of companies through a "one-stop" regime, as well as strengthened anti-monopoly powers were passed this year. The Customs Code has also been revised.

 

Only a law against "dumping" of products to drive down prices and eliminate competition remains to be passed. A draft is currently before the Armenian National Assembly.

 

"But we by no means carry out unquestioningly every demand and observation made by member countries of the WTO," Davtian says. "In the first place, we proceed from our national interests."

 

At present, 144 countries are members of the World Trade Organization. They include the former Soviet republics of Moldova, Georgia and Kyrgyzstan as well as the Baltic republics. Armenia is among 28 countries now waiting for admission.

 

"There will be almost no negative consequences. It is simply necessary to keep to certain rules if we want to integrate into the civilized world," Davtian emphasizes.

 

The possibility of enjoying Most Favored Nation status with all other WTO members on a multilateral basis is considered the most important benefit of membership.

 

But there are other gains. For instance, US restrictions on imports for countries outside the WTO are lifted once membership is confirmed.

 

"In this way, new prospects will open up for our exporters," Davtian says. "We have had two meetings with manufacturers in the last two months.

 

"We explained the benefits of WTO membership and most of them understood that there is nothing to be afraid of."

 

Member countries are barred from so-called "strict protectionism" of their markets. But tariffs as temporary measure are permitted - it is possible to increase customs duties to a maximum of 15 percent if a country can show that its economy is being harmed by particular imports.

 

At present, customs duties in Armenia ranges from zero to 10 percent, with an average rate of 4.1 percent.

 

It will likely have to revise taxation of the agricultural sector after WTO experts found the disparity between taxes on imported and domestic food production was too great in favor of local goods.

Photo by Karen Minasian

 

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