Tajikistan’s WTO membership offers pros and cons – Central Asia Online

Posted: January 26, 2013 in Economy and Resources, Environment, Geography, Health, History, Human Rights, International, Journalism, Language, Law, Politics, Relations, Resources, Tajikistan

DUSHANBE – The year 2013 promises change in Tajikistan as it is set to join the second World Trade Organisation (WTO) member in Central Asia after Kyrgyzstan.

Tajik President Emomali Rakhmon and WTO Director-General Pascal Lamy on December 10 in Geneva signed a protocol adding Tajikistan to the WTO this summer. The Tajik parliament has until June 7 to ratify the protocol, and Tajikistan will become a full WTO member 30 days later. Tajikistan will join Kyrgyzstan as the two Central Asian countries in the WTO.

Tajikistan first applied for membership in 2001 and for the past 11 years has worked to liberalise its foreign trade and investment laws and reduce customs duties in an effort to be admitted.

“Tajikistan’s accession to the WTO will mark the beginning of a new creative stage,” Rakhmon said at the protocol signing ceremony. “The country will continue to carry out constructive reforms in all spheres of the economy and will focus on developing a free and transparent trading system.”

Two opinions on membership

While some observers agree membership will boost economic development, others are discussing changes that the Tajik domestic market can expect and whether the country will be able to compete on the world stage.

Tajikistan’s accession would help make small and medium-sized business more competitive, Tajik Chamber of Commerce and Industry Deputy Chairwoman Larisa Kislyakova told Central Asia Online.

“Considerable opportunities will open up for small manufacturing companies producing high-value-added products,” she explained. “This business sector will grow, as the main tariff concessions provided by the WTO go to these product groups.” Indeed, Tajikistan’s economy already has benefited from legal reforms mandated by the WTO, according to Saifullo Safarov, deputy director of the Presidential Centre for Strategic Studies.

“Institutionally the republic made automatic progress by adjusting its laws,” he said. “In this respect, Tajikistan is becoming more attractive to investors, whose interests will enjoy protection both under national law and from a global organisation.”

Still, some say that change could be difficult, especially for agriculture.

“Small businesses set up by local entrepreneurs in rural areas hardly will be able to compete with foreign companies,” Social-Democratic Party Deputy Chairman Shokirjon Khakimov predicted, adding that, under the terms of the WTO, agricultural subsidies in developing countries should not exceed 10% of the government budget.

Kislyakova rejected that argument, saying that Tajik agricultural subsidies presently amount to only 4% of government spending, so the cap shouldn’t be a problem. Some farmers will abandon certain crops for others, economist Khodzhimukhammad Umarov said, predicting a decrease in cotton farming and adding, “Tajik farmers will … switch to more profitable crops.”

via Tajikistan’s WTO membership offers pros and cons – Central Asia Online.

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