Regionalizing Multilateralism: The Effect of Russia's Accession to the WTO on Existing Regional Integration Schemes in the Former Soviet Space

Abstract

The proliferation of regional trade agreements (RTAs) calls into question the coherence and universality of the liberal WTO multilateral trade regime. While there is a growing literature on the interaction of RTAs within WTO multilateralism, most scholars and policymakers acknowledge the severe information asymmetry between the global multilateral trade organ (the WTO) and RTAs. As Director-General of the World Trade Organization Pascal Lamy has repeatedly pointed out, it is unclear whether a number of existing RTAs violate Article XXIV of the GATT, or what the implications of a fragmented (i.e., regionalized) trade regime would mean for the stability and predictability of the WTO.

This article analyzes Russia’s recent accession to the WTO as a case study for how the WTO accommodates RTAs, and the dynamics driving the development of RTAs. This article seeks to explore the apparent benefits (procedural, legal, tactical) that RTA membership offers, versus sole WTO membership. Russia’s attempt to form a Customs Union with Kazakhstan and Belarus, with a view towards further economic, monetary and political integration, it is argued, may give Russia structural protections (particularly in the domain of dispute resolution mechanisms) that can be used to delay compliance with WTO rulings or to gain stronger negotiating leverage in subsequent rounds of multilateral trade negotiations. Building on case precedent such as the Mercosur and WTO Brazil-Tyres litigation, and scholarship on strategic uses of RTAs, this article also explores the political economy and developmental aspects of RTA formation in the post-Soviet space.

Keywords: regional trade agreements, RTA, WTO, Eurasian Union, EurAsEC, international law, fragmentation, regionalism, regionalization, multilateralism