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BEIJING - Chinese economists and businessmen are excitedly expecting that Russia's joining the World Trade Organization (WTO) will bring greater momentum to trade and investment between China and its neighbor.
China and Russia are both poised to benefit from the latter's historic entry to the trade group, according to economists.
"With its accession to the WTO, Russia's trade policies and regulations will become more transparent, and trade-liberalization measures will step up. This will help boost bilateral trade," said Zhang Jianping, an economic researcher at the Academy of Macroeconomic Research under the National Development and Reform Commission, China's top economic planner.
According to WTO protocols, Russia's general tariff rate is expected to be lowered to 7.8 percent from the 10 percent of last year. Its tariff for agricultural products is expected to drop to 10.8 percent from 13.2 percent. The country will also lower both import and export tariffs for more than one third of traded goods, with more adjustments to come in the next three years.
Currently, the volume of trade between China and Russia is low. Customs data showed the total trade value between the two economies stood at $79.25 billion in 2011. In the same period, China-European Union reached $567.21 billion, and trade between China and the United States hit $446.65 billion.
However, China-Russia trade is rising. Bilateral trade last year jumped 42.7 percent year-on-year. In the first seven months of 2012, the value amounted to $50.94 billion, up 17.7 percent. This compares to a 0.9-percent decline in China's trade with the EU and its 10.5-percent growth with the United States, according to customs data.
Reducing tariffs is the key condition for Russia's joining the WTO, and it is also the biggest concern of exporters in other countries, according to Chinese businessmen in the car industry.
Russia is expected to drop its import tariff on new sedans to 25 percent from 30 percent in the first three years, and it should be gradually reduced to around 15 percent by 2019. Chinese car makers including JAC Motors and Great Wall Motors are both eying the possibility of further tapping the Russian market, with the latter's exporting 20,000 to the market last year, according to a Thursday report by the Shanghai Securities News.
On the other hand, Russia's WTO accession has stirred intense debate, with some worrying that government-protected industries such as agriculture, light industry, machinery manufacturing and banking will be impacted.
However, Zhang Jianping believes the move will help Russia strengthen its competitive power and speed up development, while lifting the nation's global influence in trade.
"Failing to join the WTO would have meant that Russia's trade and investment were staying out of line with mainstream development globally," according to the economic researcher.
Analysts said WTO membership meant Russia will also become more welcoming toward foreign investment, which will enlarge room for Chinese investment.