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US congress set to vote on permanent normal trade relations with Russia

Farmers bring in the harvest with their combine harvesters on a barley field near the village of Uzunovo south of Moscow on Aug. 11, 2010. THE CANADIAN PRESS/AP, Ivan Sekretarev

WASHINGTON - The U.S. House of Representatives is set to remove a Cold War obstacle to trade with Russia that has stymied American exporters seeking to take advantage of Russia's newly liberalized trade practices.

Russia's entry into the World Trade Organization on Aug. 22 requires it to lower tariffs and take other market-opening measures. But unless Congress acts to eliminate a 1974 measure linking trade to the emigration of Soviet Jews and other minorities, U.S. businesses will be shut off from the benefits available to the WTO's other 155 members.

Establishing permanent normal trade relations with Russia has been a top trade priority for both the business community and the administration this year, but the House Republican leadership, sensitive to the overall poor relations between Washington and Moscow, held off on bringing up the bill before the election.

Senate Democratic leaders have said they would consider the trade bill promptly after the House acts.

To assuage lawmakers from both parties critical of Russia's human rights record, the trade bill has been combined with legislation that would impose sanctions on Russian officials involved in human rights violations.

Still, there has been resistance to acting on the trade bill at a time when Russia is seen as aiding the Syrian government of President Bashar Assad and has taken a hostile stance toward the United States on such issues as missile defence.

Republican David Dreier, the chairman of the Rules Committee and a leading advocate of trade bills, said the trade measure would be a win both for American jobs and "for the people of Russia who deserve better than they've gotten." It's a good thing, he said, "because (Russian President) Vladimir Putin is not a good guy."

The trade bill, unlike bilateral free trade treaties, requires no concessions from the U.S. side. With passage, U.S. companies and farmers would see lower tariffs, better protections for intellectual property and greater access to Russia's service market and would be able to go to the WTO to resolve disputes.

The administration and economists have predicted that U.S. exports of goods and services, currently at $11 billion, could double in five years if trade relations were normalized. If Congress fails to act, business groups say, Americans will fall even further behind Europe and China in tapping a growing market of 140 million consumers.

The bill, the White House said in a statement supporting its passage, "is about providing opportunities for American businesses and workers and creating jobs here at home."

The legislation would also extend permanent normal trade relations to Moldova, another former Soviet state.

At issue is the Jackson-Vanik amendment to a 1974 trade bill that conditioned trade with the Soviet Union to greater freedom for Soviet minorities seeking to leave the country. Since the 1990s, presidents have annually waived the now-obsolete Jackson-Vanik requirement, but it still must be eliminated as part of a permanent trade relations accord.

The accompanying human rights bill is named after Russian lawyer and whistle-blower Sergei Magnitsky, who died in a Russian jail in 2009 after allegedly being subject to torture. The House bill would impose sanctions such as visa restrictions and the freezing of assets of Russian officials involved in human rights violations. The Magnitsky bill pending in the Senate goes further to extend penalties to human rights violators around the world.

Democratic congressman Jim McGovern, said he would not be supporting the trade bill without the addition of the human rights provision, which he called "probably the most significant piece of human rights legislation attached to any trade bill" in his 16 years in Congress.

"We can vote for this legislation, if I might say so, with good conscience," said Sander Levin of Michigan, top Democrat on the Ways and Means Committee.

Russian officials have voiced strong opposition to the Magnitsky measure. The Obama administration has said that, while it does not object to the Magnitsky bill, it would have preferred that the trade legislation be taken up on its own. The White House policy statement on the bill refers generally to the need to promote respect for human rights around the world and says the administration will continue to work with Congress to support those seeking a free and democratic future in Russia.


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