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ECONOMICS REPORT - Russia Moves Closer to WTO

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This is Phoebe Zimmermann with the VOA Special English Economics Report.

Russia is the largest economic power that is not a member of the World Trade Organization. But that may change. Last Friday, the European Union said it would support Russia's effort to become a W.T.O. member.

Representatives of the European Union met with Russian officials in Moscow. They signed a trade agreement that took six years to negotiate.

Russia called the trade agreement balanced. Russia agreed to slowly increase fuel prices within the country. It agreed to permit competition in its communications industry and to remove some barriers to trade.

Russia said it will continue total control of its main energy company Gazprom. Officials also reached agreements on banking, transportation and financial protection, or insurance.

In exchange for European support to join the W.T.O., Russian President Vladimir Putin said that Russia would speed up the process to approve the Kyoto Protocol. That is an international environmental agreement to reduce the production of harmful industrial gases including carbon dioxide. These "greenhouse gases" trap heat in the atmosphere and are blamed for changing the world's climate.

Russia had signed the Kyoto Protocol, but has not approved it. A few months ago, Mister Putin had said that Russia would reject the Protocol. The agreement takes effect when it has been approved by nations that produce at least fifty-five percent of the world's greenhouse gases.

Currently, nations producing only forty-four percent have approved the Protocol. Russia produces about seventeen percent of the world's greenhouse gases. The United States, the world's biggest producer, withdrew from the Kyoto Protocol after President Bush took office in two-thousand-one. So, Russia's approval is required to put the Kyoto Protocol into effect.

To join the W.T.O, a country must reach trade agreements with major trading countries that are also W.T.O. members. Until now, Russia had reached agreement with only ten W.T.O. members. Russia must still reach agreements with China, Japan, South Korea and the United States.

Russia is the ninth largest economy in the world. The total value of all goods and services produced by the country last year was one-thousand-three-hundred-fifty-million dollars.

This VOA Special English Economics Report was written by Mario Ritter. This is Phoebe Zimmermann.

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