Legal Issues

RE RECCOMENDATION TO JOIN WTO

It is imperative to realize that the 1994 Uruguay treaty or agreement formed round eight of the negotiations that centered on multilateral trade. The negotiations took place within the GATT framework which started from 1985-1994. Within this period, over 100 members joined the treaty in the capacity of contracting parties (Gallagher, 2004, p 23-45).   Hence, as the financial manager of gasprom company I am drawn by the fact that the Uruguay agreement has many members who could be enjoying several benefits related to trade. This is particularly true because the 1994 treaty or agreement has several areas of importance which could prove useful to the company and Russia as a whole.

The first importance of the treaty is that it establishes a formula through which different countries of the world can access foreign markets better in order to trade their goods with minimal conflicts. Through its reciprocity principle, the 1994 agreement ensures that member countries gain significantly from trading with one another. The second importance is that through its valves of safety, the 1994 treaty establishes the need for fair competition which ensures that no country takes undue advantage over the other in terms balance of trade. The third importance of the 1994 treaty is that it opens up a play ground for the service sector particularly insurance and banking in different member countries.

In this respect, any member country who desires to invest in insurance or banking sector can do so with minimal limitations in any of the WTO member countries. This means that the 1994 treaty was a method of advancing trade between countries and reducing the costs that could otherwise be incurred by such countries if they had not become part of the treaty. The other benefit is that member countries are well protected from violations of copyrights through well set codes which also go along way into dealing with violations of intellectual property. This means that member countries can undertake high skilled innovations and inventions with little fear of violation of copyright or violations of intellectual property.  The above benefits of the 1994 treaty are effective to the extent that they apply to a member country as stipulated in each of the above benefits.

In this regard, Russia would therefore benefit significantly by becoming the WTO member because it would enjoy reduced tariffs whenever its goods enter the WTO market. This means that Russia being one of the most developed countries would vitally enjoy increased gains from its trade because its goods would be cheap and therefore find more consumers in other WTO member countries and therefore it would attain a comparative advantage. Many companies in Russia such as gasprom would benefit because of the widened market for goods and services as well as cheap sources of resources that would be channeled back home for the purpose of increasing production. It is therefore vital for Russia to become part of the 19994 agreementtreaty.

Since, the treaty gives freedom for the parliaments of the member countries to ratify what they consider as important or vital to them, Russia can make use of its parliament to get exempted from such clauses of the treaty that bind member countries to any United Nations related issues in order to ensure that its membership is strictly limited to trade and not on other matters pertaining to the UN. This would ensure that Russian companies set out to the wider WTO market to achieve economic benefits.