Last year’s Occupy movement has influenced public opinion of the World Trade Organisation (WTO) for the worse, but as Russia’s imminent accession shows, the WTO remains a firm force for global economic good.
Russia’s accession in August represents a remarkable achievement in the country’s economic development and a significant opportunity for exporters and investors around the world. Changes brought by conformity to WTO rules will move the Russian economy toward an open trade and investment model of economic growth, shedding its old system of inefficient import-substitution and heavily subsidized industrialization. The World Bank estimates that Russia will gain between $53 and $177bn per year because of WTO membership, reducing poverty and raising the living standards of millions. Read more
By Eswar Prasad and Karim Foda
The world economy is showing scattered signs of vigor but remains on life support, mostly provided by accommodative central banks. Concerns about spillover from a worsening of the European debt crisis and slowing growth in key emerging markets are putting a damper on consumer and business confidence. Equity markets are pulling back from a robust performance in the first quarter of this year as the sobering reality of a continued anemic recovery weakens investors’ optimism.
There are some positive signs in the latest update of the Brookings Institution-FT Tracking Indices for the Global Economic Recovery (TIGER), but also much to worry about as the world economy continues to meander with no clear sense of direction. Read more
“A man has died thanks to whom a whole new era began. A new democratic Russia was born: a free state open to the world in which power really does belong to the people.” Thus did Vladimir Putin laud Boris Yeltsin, the man who chose him for the presidency of his country. Mr Putin was both right and wrong. Yeltsin was the most democratic ruler Russia has ever possessed. Yet what is emerging under his successor is not the vibrant democracy that many hoped for. Yeltsin’s legacy is as mixed as was his turbulent nature. Yeltsin was among a small number of leaders who have transformed the world. His name will ever be linked to that of Mikhail Gorbachev, the last general secretary of the Communist party of the Soviet Union, an organisation that played so catastrophic a part in the history of the 20th century. Yeltsin’s courage and charisma brought to an end both the party and the Soviet Union itself. His enemies will never forgive him for his role in ending the party, the state and the Russian empire in 1991. But those who lived most of their lives in the shadow of the cold war will always be grateful to him. The sight of him standing heroically against the attempted coup of August 1991 is unforgettable. It was the end of a ghastly era of human history, in which despotism went almost beyond the limits of the imagination. The remainder of Martin Wolf’s column can be read here (FT.com subscribers only). Discussion from our guest economists is free. Read more
The Russian bear is awake. But this is not a Russia restored to past greatness. It is caught in a failed transition. So long as this continues, Russia will disturb its neighbours and disappoint its citizens. Is there a chance of something better? Yes, but it is a small one. Vladimir Putin expressed the attitudes of the new Russia, at once assertive and aggrieved, at the 43rd Munich conference on security policy this month. “I think it is obvious,” the president stated, “that Nato expansion does not have any relation with the modernisation of the alliance itself or with ensuring security in Europe. On the contrary, it represents a serious provocation that reduces the level of mutual trust. And we have the right to ask: against whom is this expansion intended?” Mr Putin knows the answer to this question, but does not address a deeper one, because the answer would be too painful: why do Russia’s neighbours trust it so little? For it is they who wish to join Nato, not Nato that has forced itself upon them. This is because his country brought oppression and mass murder upon them, as it is doing now in Chechnya. The remainder of Martin Wolf’s column can be read here (FT.com subscribers only). Discussion from our guest economists is free. Read more