November 18, 2008 Russia said yesterday it will push ahead with sharp rises in import duties in the near future in spite of signing the Group of 20 communiqué that promised not to introduce protectionist measures for a year.
Dmitry Pankin, deputy finance minister, said Moscow would increase tariffs on imported cars, a move that had already been planned to protect Russian car producers. Russia has also announced a general review of trade agreements, including commitments made as part of its application to join the World Trade Organisation. The review may result in duties being increased and import quotas for sensitive products being cut.
Mr Pankin said there was no contradiction between Russia's actions and the communiqué it signed as a member of the G20 leading economies in Washington on Saturday. The agreement was portrayed by the UK and US as a powerful statement against protectionism.
"The wording is sufficiently fluid . . . the formulation is careful," Mr Pankin told reporters. "No one said that anyone should scrap existing barriers or go back on existing decisions. There were no calls for this."
The US and UK governments did not return requests for comment. The European Commission said the news was not particularly troubling, as the duties would cover only a small part of trade.
But independent trade experts said Moscow's actions revealed the flimsiness of the G20's pledge to refrain from new trade protections in the next year. Fredrik Erixon, director of the European Centre for International Political Economy, a free-trade Brussels think-tank, said: "I am not surprised at all. I don't think the G20 was a meaningful exercise in trying to tie down its governments' trade policies."
Those present at the meeting said the communiqué would permit countries to impose so-called anti-dumping duties and other emergency blocks against imports. Such actions have increased rapidly in recent months as commodity prices have fallen, making it easier for companies to argue that they are being hit by dumped imports.
Mr Erixon said that such emergency actions, together with state aid to politically sensitive industries, were supplanting permanent import tariffs as the main tool of trade protectionism, and were not covered by the G20 statement.
Saturday's G20 communiqué said: "We underscore the critical importance of rejecting protectionism and not turning inward in times of financial uncertainty. In this regard, within the next 12 months, we will refrain from raising new barriers to investment or to trade in goods and services."
Source : Financial Times