Russia "optimistic" on U.S. trade vote, officials say

Reuters News
Posted: Aug 31, 2012 5:23 PM
Russia "optimistic" on U.S. trade vote, officials say

By Doug Palmer

WASHINGTON (Reuters) - The Russian government remains hopeful the U.S. Congress will approve a bill to upgrade bilateral trade relations, despite a potentially tough political climate heading into U.S. elections in November, Russian officials said on Friday.

"We are optimistic. We need to be optimistic," Alexey Drobinin, senior counselor at the Russian Embassy in Washington, told reporters. "We think that expanding trade relations is a good way to broaden our overall relationship."

Congress is under pressure to lift a Cold War provision known as the Jackson-Vanik amendment and approve "permanent normal trade relations," or PNTR, with Russia to ensure U.S. companies share in the full market-opening benefit of Moscow's entry into the World Trade Organization last week.

Drobinin discussed the issue during a briefing on Russia's hopes for next week's meeting of the 21-member Asia-Pacific Economic Cooperation forum, which it is hosting this year in Vladivostok.

U.S. business groups hope the House of Representatives and Senate will pass the PNTR legislation in September, before lawmakers return home to campaign.

But with concerns in Congress about Moscow's support for Iran and Syria, the timing of a vote remains unclear.

Republican presidential challenger Mitt Romney accused President Barack Obama on Thursday of being too accommodating to Moscow and promised "less flexibility and more backbone" in U.S. policy if he wins the November 6 election.

The Jackson-Vanik amendment tied normal tariff treatment for goods from the former Soviet Union to the rights of Jews to emigrate. Russia has been deemed in compliance for nearly two decades. But the provision remains on the books, at odds with WTO rules requiring members to provide normal trade relations to one another on an unconditional basis.

Mikhail Kalugin, acting head of the embassy's economic section, said that although Washington had still not approved PNTR, Moscow did not plan to impose higher tariffs on goods from the United States than on other WTO members.

"But still, on paper, the United States should repeal Jackson-Vanik" to ensure U.S. companies receive the full benefits of Russia's accession, Kalugin said.


In addition to making tariff cuts, Moscow has agreed to opens its services markets and make other reforms as part of its accession to the WTO. U.S. companies fear those benefits are at risk and worry they will not have the protection against arbitrary Russian trade measures until PNTR is passed.

Congress is expected to attach legislation known as the "Magnitsky bill" to punish Russia officials for alleged human rights abuses to any bill to establish PNTR.

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In addition, some lawmakers are pushing for a non-binding resolution of disapproval for Moscow's support for the Syrian government in its bloody battle against rebel groups.

"Of course, we are against any non-trade issues to be inserted in a trade bill. ... Our opposition is very clear on that," Kalugin said.

The United States and Russia have been working together on a number of issues related to APEC.

Those include initiatives aimed at reducing tariffs on environmental goods, improving food security, reducing "choke points" in global supplies and using trade agreements to improve government transparency, Kalugin said.

Obama is skipping the APEC summit on September 8 and 9 because it comes right after he accepts the Democratic Party nomination on Thursday to run again for president.

Secretary of State Hillary Clinton will represent the United States at the summit.

(Reporting By Doug Palmer; Editing by Peter Cooney)