Car industry investors to be compensated for possible WTO-related losses

15.11, 17:54

Russia’s largest car producer AvtoVaz is firing on all cylinders after posting a huge increase in its net income for the first nine months of 2011.

14.11, 16:19

A new free trade agreement between most of the former Soviet republics will help Ukraine liberalize its trade with Russia and boost progress in talks on striking a similar agreement with the EU.

Russia and WTO

Published: 17 November, 2011, 01:40
Edited: 17 November, 2011, 11:23

The launch of new production line of Renault Sandero at Avtoframos factory. (RIA Novosti/Ruslan Krivobok)

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TAGS: Russian economy, WTO

Meeting WTO standards may come as a heavy burden to some industries, but the Russian government is ready to help deal with it to provide a smooth transition.

Russian Prime Minister Vladimir Putin says the government will help foreign investors in the country’s car making industry.
“We discussed for a long time during Russia’s WTO accession process how we should do this work in future in order not to let our investors down and keep all our promises, and at the same time to meet WTO car-making requirements,” he said at the meeting with German businessmen.

Putin says compromises have been reached and the government will take part of the burden to meet its obligations to investors. Foreign car makers currently enjoy tax benefits which may be revoked once Russia joins the WTO. This year the government promised tax benefits to several foreign car companies including Ford, Volkswagen and Renault. In exchange these companies agreed to assemble 300,000 cars a year in Russia using mostly locally made components. These benefits are expected to last until 2020 but may be lifted earlier because of Russia’s accession to the WTO.

Russia’s car market is a lure to investors. Car sales grew by 27 percent in the first nine months of the year.

Today: 01:12

Russia is planning to cancel fees for foreign airlines using airspace over Siberia, thus making flights from Europe to Asia cheaper.

Russia and WTO Today: 14:05

The Lake Baikal region wants to turn itself into the Alps of Central Asia with a billion dollar project to create a ski resort.

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