Iana Dreyer in Brussels -
The World Trade Organization’s Working Party on Kazakhstan’s accession has endorsed a final report on the Central Asian nation’s preparedness to join the multilateral trade body. Kazakhstan’s accession is now largely a formality.
A final hurdle to clear is the acceptance of the bid by the General Council, the WTO’s highest decision-making body, which is due to meet late July. WTO Director General Roberto Azevêdo said June 22 that Kazakhstan ”is very close to being accepted as a WTO member.”
Kazakhstan’s WTO accession, a tortuous 20-year process, matters greatly to the EU. The Central Asian country is the sixth biggest source of EU oil imports, and of increasing strategic importance for the bloc from an energy security perspective.
After the Ukraine crisis, the EU has been keen to engage more closely with Central Asia, responding at the same time to the region’s capitals’ desire to diversify their own diplomatic relations as the influence of Russia and China grows.
The announcement of Kazakhstan’s success in joining the WTO coincides with the endorsement by EU member states in Brussels of a revamped EU Central Asia foreign policy strategy, which among other things ”calls for strengthening trade and energy links between the EU and Central Asian countries”. Kazakhstan’s WTO accession “should translate into a new Partnership and Cooperation Agreement between Kazakhstan and the EU”, EU trade officials stated.
Kazakhstan’s WTO accession is also likely to remove one – of many – hurdles in the EU’s currently fraught trade relationship with Russia and the regional trade grouping it sponsors, the Eurasian Economic Union (EEU), of which Kazakhstan is member, along with Belarus, Armenia and Kyrgyzstan.
For many years the EU was hoping to negotiate a free trade agreement with Russia that builds on the country’s WTO accession. Russian joined the WTO in 2012, but rising political tensions with Moscow over Ukraine have put these plans on ice.
Kazakhstan’s and Belarus’ absence from the WTO has been another complicating factor in EU-EEU trade relations, said EU trade officials in a briefing with journalists June 22. WTO membership provides basic trade rules and a minimum of policy transparency on which to base preferential trade talks, they explained.
Kazakhstan’s WTO negotiations have been held off for two decades for a variety of reasons: an on-and-off commitment to liberal economic trade reforms typical of an oil-dependent economy; Kazakhstan’s decision to let Russia join the WTO first; and domestic political sensitivities over the level of agricultural subsidies that Kazakhstan is allowed to maintain, over its food safety rules as well as over some of its foreign investment measures.
More recently, WTO negotiators had to iron out incompatibilities between Astana’s early WTO accession commitments and some of its trade rules adopted more recently as a result of its membership of the EEU.
Kazakhstan is due to implement its WTO commitments the moment its accession is ratified. Yet Astana was given some extra time to implement the WTO’s TRIMS (Trade Related Investment Measures) agreement, which forbids members to force foreign investors to source goods or services from local firms.
Kazakhstan is slated to become the 162nd WTO member. Remaining countries outside the world trade body include other oil-dependent economies in Central Asia, the Caucasus and the Middle East, as well as and some states sub-Saharan Africa and the Pacific.
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