WTO: king for a day



Mass of disputes and to this day is the role of the WTO, the need of Russia's entry into this beacon of the international economy. It would seem that Russia has formally joined the WTO. However, looms on the horizon yet ratified, which would put a bullet in the endless debate about the terms and conditions of entry into Russia. Ratification — it's gong at the beginning of the most complex round between domestic manufacturers and their foreign competitors. The package of documents on accession to the WTO must be ratified by the Russian Federation to the July 3, 2012.

Trying to sort out the issue, I have listened to quite a lot of opinions. But let us first.

Benefits of the WTO trading system

This information can be found on the official website of the WTO. I shall mention only a few economic and political:

1) Improving the efficiency of foreign economic activity.
2) Strengthening of international stability
3) Increasing employment
4) Increased income
5) An effective mechanism for resolving disputes

Frankly strange advantages. Especially here it is — "strengthening international stability." This is generally what? Greatly strengthened if international stability in recent years? And after all of the 157 countries in more than 200 have become members of the WTO. And if imports significantly increased, destroying the domestic producer, it can also be called "Improving the efficiency of foreign economic activity"? On increasing whose income is it? On increasing the employment in which countries? Yes, I can understand the fact that we benefit low import duties on the import of bananas, figs or kiwi, but it might be worth it for them to agree?

Now a few words about the main trump defenders joining the WTO, "effective dispute resolution mechanism."

It is naive to believe that world trade is not politicized and regulated solely by market mechanisms. The existence of a mechanism to resolve disputes between market participants as part of any commercial organization does not mean crystal objective consideration of such disputes. Especially because we already know the price of international law in practice. And here is a vivid example of the history of the WTO — the eight-year struggle Boeing and Airbus. The fact that both the U.S. and the EU in this case violated the Agreement on Trade in Civil Aircraft since 1992. This agreement significantly limits the size of subsidies from the state, and the ability of many indirect ways to support their producers. In its decision the WTO recognized the violations by both!
Analyst aerospace company Teal Group, Richard Abufalia expressed confidence that Boeing is able to do many things in order to circumvent the decision of the WTO. " The same thing, in his opinion, can do and Airbus with paragraphs verdict, which do not suit the European side. "Unfortunately, this process does not benefit anyone," — said the expert.
According to Karel De Gucht, the European commissioner for trade, "European industry and in particular the aerospace industry suffered losses of billions of euros, and this is unacceptable. It is time to stop the illegal subsidies," Boeing "by the U.S. authorities to stop anti-competitive and adhere to international trade rules . "
Mr De Gucht said that the damages should be calculated in the billions, but in the end? Experts believe that in the end the two companies are likely to be forced to restructure part of the state grants and enter into a settlement agreement. That's right, almost eight years of squabbles, billions in losses, and they shook hands and parted.
Very effective!

On the market, the capital and the "invisible hand"

Currently, of the 100 largest economies in the world 52 — it TNCs. The most powerful capitals are always eager to concentrate. Not themselves of course. As it happens, we saw in the case of large U.S. capital during the global financial crisis of 2008. Cheap source of capital for TNK — the largest U.S. banks. Normal thing if the percentage of loans in their 1-2%.
Consequently, some of the laws of the market, so adored by our "market-liberal" here simply do not work. In some segments of the market, where it can act in a limited number of players (especially individual indicator), the term "market price" is rather arbitrary. By agreement or joint need large companies can raise or lower the price in any market, be it global or domestic. In theory, it is proposed that the "invisible hand of the market" will do everything herself.
What is it that there is no competition at all? Have. Just looks like it's not like her are some of our economists. It is believed that the free market will regulate itself, and the participants in it are equal. This is not the case. Objectively, there is competition, but this is only half the picture. The other is the fact that with few exceptions, any market participant, somehow able to affect the current price.

Here is a practical example of which occurred in the grain market in New Jersey. On the territory of the region around 2500 wheat producers (IP, KFH, large agricultural companies and holdings). Volumes of production are different from 100 tonnes to several tens of thousands of tons of the cleaning. Foreign exporters, such as "Glencore", "Louis Dreyfus", "Cargill-SOUTH", "Bunge CIS" buy grain for shipment to Turkey, Iran, etc. Make it through the smaller firms that are able to find the necessary volume to ensure its quality and bring it into port. One such company found and purchased volume, and implement it to exporters could not, and not to suffer losses raised prices in the market. How? Very simple. She said the major manufacturers that prices are about to go up. The result was very predictable. No cheap to sell their products, with a few exceptions, did not want to. Do exporters under existing contracts matured deficit, terms also expire. They are not to suffer a loss, it was necessary to acquire the data volumes on the already formed prices. Small firm effect on the market! What to say about the major players, and even more so on the TNC?

Here's an interesting sketch of the market:
The company "Danone" released a drinking yoghurt "assets" Pack of 200 grams with the inscription "A total of 20 rubles. *", While below on the packaging was cited footnote "* recommended price for the sale of the Russian Federation." FAS decided that such actions "Danone" violate the antitrust laws "in coordinating economic activities of businesses involved in retail sales of products of society."

Here's how commented, head of the expert of the Center of financial problems, Maxim Timofeev:
"Of course, publish the marginal price for the goods from the point of view of normal market — this is nonsense. Since the days of Adam Smith's "invisible hand of the market" itself regulates the prices — always downward. This is precisely the main principle of competition: market participants competing low price and high quality products. By the way, in the western markets with the regulators problem arise at those sellers who artificially lower the price of its product to capture a larger segment of the consumer market. This is called "price dumping", and for that they might be punished.
As for us in this case we are talking about the maximum price. What's left to do Western comrades, if the market is so crazy as Russia? Indeed, manufacturers are suffering from the fact that the prices of their
goods are unreasonably inflated, and it is worse for sale. They lose their customers and profits on the decline in output — of course, it is not profitable. A domestic sellers often operate on the principle that cheat the price a little more, and let it lie, will still buy. But you can immediately take off more revenue from consignment and do not strain it, and deal with suppliers. "

Strange how something from a friend Timofeev is obtained from the time of Adam Smith, that she's "invisible hand of the market" prices are lower, while the shiftless Russian businessmen all the exact opposite. Clocked up the price a little more, do not wait and grieve, and even more revenue jerked! Here's who to seek advice at the right time to go, and then the sharks of capitalism have much to learn. Do not act on our merchants no laws! Wondrous miracle.

A.P.Portansky, chicken and Patriots

A year ago, I attended a lecture of one of the experts on the accession to the WTO, Mr. Portansky AP, director of the Information Office on Russia's accession to the WTO. The purpose of this office — information support of accession to this international organization. There are many examples, which, in my opinion, seem to be in error in the logic of Alexei Pavlovich. Here is one.
He told us a real-life example of a businessman who produces a chicken. Next quote:

"Here he is (chicken producer — mark author) loves to come to any big store, walk up to the window and say," Well, what have you here like this here, "Bush legs"? They are all blue, well, how can you sell such products? It would be necessary to remove all of it from the counter! And here's our chicken should you take the counter! Our chicken is good! It is necessary to buy our chicken. " Here you go.
A young man doing just two blunders. First, it reveals a complete ignorance or disregard of the principle here — the equal treatment of foreign and domestic manufacturers. What it is, on the fingers. If the imported goods are legally crossed the border of the country, all the procedures are absolutely, paid import duty, all fees payments and so on, then after that related to this imported goods must be exactly the same as the ratio of the products originating in the territory.
And here we have some Christians tend to be larger than the Pope, highly patriotic than anyone else. And here they come, tear his shirt over his chest and say, "What are you out there," Bush legs "? Let's take our chicken! "
The second serious miscalculation is that this man, as it were, does not want to ignore the principle of social justice. Why is our government buys legs, "Bush legs" here these. Because our business, it still can not fill the niche of low-price. It fills the high-price category, the mid-price category, but the cheap goods it can offer. In our society, as in most others, are not all rich. There are abundant, there are average, there are poor. So which is better? Enable the poor man malosostoyatelnomu buy at least here these here, "Bush legs" which, by the way, were all the same test, the same food that is usable, or he will not be able to buy anything? "

This calculus.

Ask yourself what kind of chicken you buy? Cheap or expensive? As a consumer can check the quality of the chicken? Let's imagine. On the counter will be based on two locations: the chicken (the U.S., non-GMO, etc.) and chicken (Russian, non-GMO, etc.). One will cost 50 rubles, another 60 rubles. Add to that the lack of information still discrimination manufacturer, as a condition of WTO. What will our domestic chicken chicken "premium"? Why does our chicken "premium class" should not lose customers? Why "Bush legs" in the long term will not be able to take both segments of the market? Chicken (RF) and chicken (United States) — substitute goods, excluding the information discrimination. Patriotism is difficult to sell, shall cleave it to the chicken! Yes, there is a small percentage of "chicken patriots." But, most importantly for the price. And if it is lower it will be cheaper to buy. Pure pragmatism.

One of the recent public debate A.P.Portanskogo can be seen here. Not surprisingly, Alexei Pavlovich also eagerly waiting for "The Rain" and "Echo of Moscow". N.V.Starikov in 2010, also wrote about this gentleman.

Now, a few conclusions to the entry into the WTO, which seem to me the most compelling:

1. Obviously, we do not have a large range of services and products that we can offer to the world market. For the group of goods and services that our manufacturers and companies are able to offer, we can always negotiate a bilateral mode. Our oil and gas demand, wheat sales also hit record, production of fertilizers is also in high positions.

2. Terms of loans to foreign representatives and producers in Russia differing enormously. In the U.S. and Europe, the interest rate — 1.5 to 3%, in Russia — 10-15%. All this affects the cost of the final product.

3. I believe that the lack of domestic producers of essential goods (food, pharmaceuticals, etc.) is a threat to national security! As well as the lack of their own machine-tool, instrument and mechanical engineering, which is what is most important, and above all — is a component in the processing chain up to the space industry and the military industrial complex.

4. Finally, it is necessary to objectively recognize our technological backwardness compared to the EU industrial base and the U.S.. Results devastation experienced by us in-the-90s level for a couple of years, not have to sweat. And the technology we sell, as we know, no big hurry.

For some reason, the WTO advocates forget is that we do not live in a perfect world ruled by love and universal understanding. And sometimes in the cynical reality, we put ourselves in a vulnerable position. And how much should we not told about the tasty and cheap "cookies", it is worth remembering that it can stop in one day. A good example is Iran! That's where the solid humanism and "strengthening international stability."
Besides, why should we get involved in the system, Cawthra rapidly collapses? Here I mean the global financial system. Why build a new mutually binding due to this unstable system?

There is a direction of applied science — risk management. Is there such a method — a method failure. It is used when the identified risks seem excessive. In my view, the accession to the WTO, with all the real-world advantages (cheap and tasty yogurt, fancy cars) — excessively risky gamble.

If someone wants to further explore the connection of the primary sources of the results, you will here.

If you are convinced of the evils of the entry into the WTO, then welcome to the preparations for the referendum.

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