USTR Working to End Jackson-Vanik for Russia, but No Bill Yet
According to sources at the Office of the U.S. Trade Representative, the Administration is working closely with USTR committees of jurisdiction on the best way forward to terminate application of the Jackson-Vanik amendment to Russia and to extend permanent normal trade relations (PNTR) to Russia. Other sources indicate that the politics of the matter are difficult and no legislation has yet been introduced.
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(USTR sources have confirmed that unless the Jackson-Vanik amendment is revoked for Russia and the U.S. extends PNTR to the country, U.S. companies will not benefit from Russia’s WTO commitments when Russia becomes an official WTO member. Instead, U.S.-Russia trade would continue to be governed by the U.S.-Russia Bilateral Commercial Agreement (BCA), under which Russia and the U.S. will continue to apply most-favored-nation (MFN) tariffs to each others’ imports, as well as customs rules and formalities, taxes and internal charges applied to imports or exports, and other rules. This means that U.S. companies will be bound by a limited bilateral agreement and face barriers that their global competitors will not if PNTR is not extended by the time Russia becomes a WTO member. See ITT's Online Archives 11122224 for summary.)
Baucus Says Congress Has Until Summer 2012 to Pass Legislation
Senate Finance Committee Chairman Baucus (D-MT) recently called for the termination of the Jackson-Vanik amendment for Russia and the establishment of PNTR as a major trade goal for 2012. He stated that the U.S. must seize the opportunity provided by Russia's summer 2012 entry into the WTO to expand market access in Russia for U.S. businesses. If Congress doesn't pass legislation that repeals the Jackson-Vanik amendment's application to Russia and establishes PNTR with Russia by summer 2012, he stated U.S. companies will lose out to companies in China, Europe, and the 150 other members of the WTO.
Senator Hatch Says PNTR Would Ignore Russia's Corruption, Theft of U.S. IP, Etc.
Senator Hatch (R-Utah) has stated that the President's new top legislative trade priority to secure PNTR with Russia is a poor substitute to a comprehensive and coherent trade agenda. According to Hatch, the President would have Congress pass PNTR and ignore Russia's corruption, theft of U.S. intellectual property, poor human rights record, and adversarial foreign policies. He added that Russia is a market the U.S. has access to anyway on a Most Favored Nation (MFN) basis once Russia joins the WTO.
(See ITT's Online Archives 12031253 for announcement of a March 15 Senate Finance Committee hearing on the impact of Russia's WTO accession on the U.S.
See ITT's Online Archives 12030123 and 12030832 for summaries of USTR Kirk's testimony at February 29 House Ways and Means Committee and March 7 Senate Finance Committee hearings on the President's 2012 trade agenda.
See ITT's Online Archives 11122001 for summary of a list of WTO benefits by sector if Congress repeals the Jackson-Vanik amendment.)