Parliamentary Lobbyists Promote Ukraine’s WTO Membership
The Cabinet of Ministers have presented the Verkhovna Rada agrarian and industrial committees with arguments in favor of Ukraine’s membership in the World Trade Organization, which upholds the principles of free trade. Today WTO countries account for 95% of the global trade. Vice-Premier Vasyl Rohovy told deputies that lifting customs barriers would intensify competition on the Ukrainian market in favor of consumers and speed up the advent of new Western technologies in this country’s economy. Yet, the deputies were given no concrete long- term estimates. The governmental official in charge of Ukraine’s prospective WTO membership, State Secretary at the Ministry of the Economy Andriy Honcharuk, assured the audience that this kind of estimate, now being drawn up by a group of experts, would be ready by December.
To prove the economic advantages of joining the WTO, the government cited evidence that Ukrainian metallurgy loses up to almost $2 million annually due to antidumping lawsuits. If Ukraine were a member of the World Trade Organization, it could avoid these losses. Should this country remain outside the WTO in the immediate future, the Ministry of the Economy predicts that the losses incurred by exporters might jump to about 6 billion dollars a year. It was also noted that gradual enlargement of the European Union brings down the number of neighboring countries with which Ukraine has signed free trade treaties. This leads to the loss of markets. Again, this problem could be avoided if this country became a WTO member.
These arguments had the least effect on the position of parliamentary agrarians. They unambiguously spoke out against Ukraine joining the World Trade Organization. “Our own calculations show that Ukraine will lose a great deal more than it will gain if it opens its borders to import foodstuffs,” said Kateryna Vashchuk, the informal head of the parliamentary lobby of land-tillers. In her words, it is impossible to compete fairly with foreign companies on the agricultural market because they are heavily subsidized by their governments. In particular, WTO regulations allow wide- scale support for seed growing, as a result of which, for example, French farmers receive sowing grain almost free of charge. Naturally, this gives them a competitive edge. The agrarians made it clear that even if they chose to accept Ukraine’s membership in the World Trade Organization, they would do so only after the agro-industrial sector had received tangible support.
Economy Ministry State Secretary Andriy Honcharuk immediately tried to inspire at least a shadow of optimism in the hearts of the agrarian lobbyists. In his words, the WTO’s $1.37-billion-worth restrictions on governmental subsidies for the Ukrainian countryside are today almost zero. The ministry also expects that WTO membership will furnish Ukrainian farming export with new markets worth an annual $2.5 billion. Besides, Mr. Honcharuk believes that the Ukrainian agrarian market should not fear any negative consequences of the forthcoming import, for 95% of today’s domestic demand is being met by national producers. Yet, agrarian faction leader Ms. Vashchuk (also member of the parliamentary financial committee) remained adamant, saying that the government’s reasoning failed to convince her. It should be noted that another influential — metallurgical — parliamentary lobby has not yet taken a common stand on the WTO. Aware of the benefits of a likely expansion of export markets and the abolition of antidumping restrictions, the “steel-making” deputies still have no advance information about consequences for the domestic market. At the same time, industrial committee chairman Yury Yekhanurov spoke out in no uncertain terms in favor of WTO membership, saying that Ukraine should strive for integration into international organizations for political reasons above all. However, he also admitted that an all-round expert analysis of the likely consequences for this country is still to be made.
The government representatives promised to analyze it in the immediate future and requested the deputies not to feel nervous in regard to this. What is more, the deputies were urged to pass a package of laws that simplify the access of foreign companies to the Ukrainian markets of goods and services. Yet, the Cabinet heard no assurances in return. It will be recalled that in early October, at a French business workshop in Evian, WTO topmost executives drew up an optimistic scenario whereby Ukraine is expected to be admitted to this organization by September 2003.
