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http://www.eurasianet.org/departments/insight/articles/pp122102.shtml
EURASIA INSIGHT December 21, 2002
ARMENIA: A WTO MEMBER, FINALLY
Anna Hakobyan: 12/21/02
A EurasiaNet Partner Post from Transitions Online
After Armenia and the United States settled their differences over regional trade issues, the General Council of the World Trade Organization (WTO) approved Armenia’s accession to the body. The council’s December 10 vote at its meeting in Geneva means that Armenia becomes the seventh ex-Soviet republic to join the WTO, along with Estonia, Latvia, Lithuania, Georgia, Moldova and Kyrgyzstan.
Prime Minister Andranik Markarian termed admission to the trade regulation body the most important step for his country since gaining admission to the Council of Europe, ITAR-TASS reported.
A delay in the negotiations came last year when some WTO members complained about Armenia’s slow legislative reforms. The parliament then passed a number of laws bringing the country into compliance with WTO rules on access of foreign goods and services to the Armenian market in such areas as customs duties, taxes, intellectual property, export and import licensing and domestic market protection.
A further delay came in late September when the office of the US Trade Representative set additional requirements at a meeting with Armenian trade officials. The requirements mainly dealt with protection of domestic and foreign intellectual property, taxation and customs regulations.
At the same time a misunderstanding between Armenian and US officials led Economy Minister Vartan Khachatrian to state that the United States wanted to delay Armenia’s entry until Azerbaijan was ready to join the trade organization, RFE/RL reported. On October 10 Khachatrian publicly retracted his comment after a forceful reaction from Washington.
Before leaving for Geneva, Markarian disclosed that Armenia would not seek to veto Azerbaijan’s future accession to the WTO, because Turkey said it would cease its tacit objection to Armenia’s membership. Turkey maintains a blockade of Armenia’s western road and rail links in protest at continuing tension between Armenia and the Muslim enclave of Nagorno-Karabakh, which Azerbaijan claims.
The reported demand for simultaneous accession with Azerbaijan was strongly criticized in Armenian society and media. Gagik Gabrielyan, a trade analyst who assisted the Armenian government in the accession process, told TOL that Turkey had demanded Azerbaijan be allowed to join the WTO along with Armenia, even though Azerbaijan was at a much earlier stage in the negotiation process. He said such a requirement also violated WTO provisions.
Gabrielyan said Armenia would now be able to raise the issue of Turkey’s blockade within the framework of the WTO. However, Turkey has already said it will not follow WTO agreements on multilateral trade with Armenia. The WTO agreement allows member states to take such a step without facing trade penalties provided they give advance notice to the organization’s secretariat.
The Armenian government has not responded to Turkey’s latest move.
Officials say that WTO membership will give a further boost to the country’s already fast-growing economy. On December 13, Trade and Economic Development Minister Karen Chshmaritian said joining the worldwide trade system could add another 4 percentage points to gross domestic product next year. According to government statistics, Armenia’s gross domestic product grew by 9.6 percent in 2001 and should increase a further 12 percent in 2002.
Not all analysts share the government’s rosy view. Gabrielyan said that applying WTO rules on value-added tax (VAT) to agricultural products, starting in 2009, would have negative economic and social consequences, although the actual impact of the new rules is not easy to forecast. Agricultural products currently enjoy VAT-free status.
Markarian said the benefits of WTO membership would accrue gradually and would not become tangible for five or six years, RFE/RL reported.
Armenia is the only country in the Commonwealth of Independent States whose economy was rated as "mostly free" in a joint study by The Wall Street Journal and the Heritage Foundation, a conservative Washington think tank.
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Posted December 21, 2002 © Eurasianet
http://www.eurasianet.org
EURASIA INSIGHT December 21, 2002
ARMENIA: A WTO MEMBER, FINALLY
Anna Hakobyan: 12/21/02
A EurasiaNet Partner Post from Transitions Online
After Armenia and the United States settled their differences over regional trade issues, the General Council of the World Trade Organization (WTO) approved Armenia’s accession to the body. The council’s December 10 vote at its meeting in Geneva means that Armenia becomes the seventh ex-Soviet republic to join the WTO, along with Estonia, Latvia, Lithuania, Georgia, Moldova and Kyrgyzstan.
Prime Minister Andranik Markarian termed admission to the trade regulation body the most important step for his country since gaining admission to the Council of Europe, ITAR-TASS reported.
A delay in the negotiations came last year when some WTO members complained about Armenia’s slow legislative reforms. The parliament then passed a number of laws bringing the country into compliance with WTO rules on access of foreign goods and services to the Armenian market in such areas as customs duties, taxes, intellectual property, export and import licensing and domestic market protection.
A further delay came in late September when the office of the US Trade Representative set additional requirements at a meeting with Armenian trade officials. The requirements mainly dealt with protection of domestic and foreign intellectual property, taxation and customs regulations.
At the same time a misunderstanding between Armenian and US officials led Economy Minister Vartan Khachatrian to state that the United States wanted to delay Armenia’s entry until Azerbaijan was ready to join the trade organization, RFE/RL reported. On October 10 Khachatrian publicly retracted his comment after a forceful reaction from Washington.
Before leaving for Geneva, Markarian disclosed that Armenia would not seek to veto Azerbaijan’s future accession to the WTO, because Turkey said it would cease its tacit objection to Armenia’s membership. Turkey maintains a blockade of Armenia’s western road and rail links in protest at continuing tension between Armenia and the Muslim enclave of Nagorno-Karabakh, which Azerbaijan claims.
The reported demand for simultaneous accession with Azerbaijan was strongly criticized in Armenian society and media. Gagik Gabrielyan, a trade analyst who assisted the Armenian government in the accession process, told TOL that Turkey had demanded Azerbaijan be allowed to join the WTO along with Armenia, even though Azerbaijan was at a much earlier stage in the negotiation process. He said such a requirement also violated WTO provisions.
Gabrielyan said Armenia would now be able to raise the issue of Turkey’s blockade within the framework of the WTO. However, Turkey has already said it will not follow WTO agreements on multilateral trade with Armenia. The WTO agreement allows member states to take such a step without facing trade penalties provided they give advance notice to the organization’s secretariat.
The Armenian government has not responded to Turkey’s latest move.
Officials say that WTO membership will give a further boost to the country’s already fast-growing economy. On December 13, Trade and Economic Development Minister Karen Chshmaritian said joining the worldwide trade system could add another 4 percentage points to gross domestic product next year. According to government statistics, Armenia’s gross domestic product grew by 9.6 percent in 2001 and should increase a further 12 percent in 2002.
Not all analysts share the government’s rosy view. Gabrielyan said that applying WTO rules on value-added tax (VAT) to agricultural products, starting in 2009, would have negative economic and social consequences, although the actual impact of the new rules is not easy to forecast. Agricultural products currently enjoy VAT-free status.
Markarian said the benefits of WTO membership would accrue gradually and would not become tangible for five or six years, RFE/RL reported.
Armenia is the only country in the Commonwealth of Independent States whose economy was rated as "mostly free" in a joint study by The Wall Street Journal and the Heritage Foundation, a conservative Washington think tank.
Email this article | Printer-Friendly Version
Posted December 21, 2002 © Eurasianet
http://www.eurasianet.org