Russia has agreed to phase down its farm subsidies according to a draft report on  the World Trade Organization (WTO) negotiations with Russia, described by officials to BNA. Russia is reportedly ready to accept an eventual cap of $4.4 billion per year  of trade-distorting farm subsidies as part of its agreement for accession into the WTO.

The cap on “amber box” subsidies will initially be fixed at $9 billion per year, but this amount will be reduced to $4.4 billion by 2018, according to a draft Russian schedule of goods commitments circulated to WTO members.  The goods schedule is part of the overall Russian accession package that WTO members are working with Russia to complete and approve before the end of the year.

In addition, Russia will accept product-specific spending limits in order to ensure that the support is not concentrated on a handful of key farm goods and has agreed to eliminate all export subsidies for agricultural goods upon the date of accession.  The final figures on amber box subsidies are in line with a compromise offer put forward by Russia last year in the accession negotiations.

Russian officials told WTO members last January that the government spent $5 billion in trade-distorting subsidies in 2009 and that this figure was due to increase in 2010 and 2011 as it engages in an overhaul of Russia’s agricultural sector.  However, Russian President Dmitry Medvedev insisted on July 25 that Russia is “not discussing any reductions in government support for agricultural producers following WTO accession.”  The Russian government is “committed to providing $9 billion in assistance through 2012, with some gradual reduction through 2017,” Medvedev said, according to remarks posted on the Russian president’s official website.

Russia still must reach agreement with several agricultural-exporting nations on tariff rate quotas for imports of poultry, beef, and pork and address remaining concerns regarding sanitary and phytosanitary (SPS) restrictions on agricultural imports.   One official following the negotiations said “very significant progress” was made on addressing SPS barriers at a late September meeting in Geneva  between Russia and other WTO members focused on the issue.

 

 

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