After a high level meeting with EU commission officials, Deputy Prime Minister Igor Shuvalov said: “We have … an agreement on a text on raw materials”. Export tax phasing out “will be imposed from the time we ratify our accession to the WTO”, he added.

Russian export duties on raw materials - such as timber, escalate input costs for EU industries such as Nordic timber and paper industries. The removal of duties eliminates European veto and paves the way for Russia’s accession.

“Both sides are confident that this agreement will greatly facilitate the overall process of accession of Russia to the WTO”, announced the EU and Russian delegation in a joint statement. The WTO with 153 member countries is the largest trading block and Russia is the biggest economy outside of it.

Russia has been building pressure to join WTO for some time with President Medvedev discussing the issue with the US president Barack Obama recently. However, Georgia is opposing Russia’s accession formally, which must be sorted out before Russia can join in.

According to WTO rules, any aspiring country (Russia, in this case) must reach bilateral agreement with existing member (Georgia) if there is scope for the same, as well as with a working country representing the entire membership. However, after the two neighbors fought a war in 2008 and Russia’s following support for two breakaway regions deprives Tbilisi of control of customs along its internationally recognized borders. Georgia is using its veto power against Russia blocking its accession to WTO.