Russia WTO
https://www.jdsupra.com/legalnews/russia-will-challenge-economic-4720758/
In 2012 Russia joined the World Trade Organization. However, Russia has been involved with trade and negotiation with the World Trade Organization since 1994. Russia is one of the producers of crude oils, grains, metals, wood, and plastic. So, since Russia is threatening to pull out of the World Trade Organization is a major deal.
The fact that Russia may pull out of the WTO is due to the conflict that is currently occurring with Ukraine. If Russia pulls out, there will be a massive effect on global trade. Whether that effect is within the first 5 years or the next 100 years, somewhere down the line there will be an issue. We are already seeing an issue take place by the conflict causing trade tankers to either be diverted away from the black sea, or tankers being stuck at ports being unable to unload their goods. One family-owned company called Interunity Group is currently struggling because of this. They have 60 oil tankers and a few bulk tankers that are currently inoperable because they are run by Ukrainian and Russian Captains. This conflict is also putting a pause on 30% of the world's wheat output. This is an issue because wheat and grain take such a large area to be able to produce. Unlike crude oil, which can be picked up by other locations.
If we take a country like Turkey, for example, they receive 78% of their wheat from Russia and 9% more wheat from Ukraine. With both the countries currently on pause, what is the food situation in these countries look like? Not only will they not have enough food and supplies, but the prices are also going to be outrageous and unbearable. We can see this taking place in the United States currently. Russia was the United State’s third-largest supplier of oil products. Russia was only behind Mexico and Canada. The gas prices in the United States have been the highest they have ever been. The price of a barrel of oil is over $110, the highest it's seen since 2013. Not only that but oil tanker's prices have been increased by 400% due to the fear that oil is going to be inaccessible in the near future.
To conclude, the conflict between Russia and Ukraine is impacting the world even more than we thought it would. Russia has threatened to pull out of the WTO which would cause mayhem eventually. Since Russia is such a massive supplier of resources to the world, some countries may find it difficult to be able to find the supplies they need. Also, if they can find someone, they are going to be at an outrageous price due to the fact that they are in such high demand. This will affect certain countries differently than others, but it will affect every country in one way or another.
This is a very important topic that is extremely relevant in conversation today. The issue with the possibility of Russia pulling out of the WTO agreement can potentially hurt many businesses and consumers. It is so interesting to see how a conflict in other countries impacts even people's daily lives. You show this with your example about the elevated gas prices. This proves how interconnected the world has become and why conflict anywhere in the world affects every country. Because of these impacts do you think that it is relevant for other countries like the US to become involved and try to put a stop to the issue?
ReplyDeleteNice post, I particularly liked the example you used regarding Turkey. I think too often we think about this world in a very ego-centric way, as if the consequences of our actions internationally only really matter in how the effect us. This is obviously not the case. To what degree do you think the US has a responsibility to step up and help countries that stand to lose the most when we impose sanctions that hinder the global economy.
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DeleteI really want to branch of off Sam's question/comment! I think you, Logan, point out how disastrous Russia pulling out of the WTO can be, especially for countries other than the United States. But because of how interconnected we are, like Caitie said, how do you think this is going to impact how the United States holds itself accountable in the countries its become involved with (even when forcible)? I'm interested to see if you can think of possible consequences for Russia if they decide to pull out of the WTO. Exactly how much would they lose? Would this be a smart move on their part? What would their goal be in pulling out?
DeleteI enjoyed reading your blog simply because it touched on similar principles covered in my blog post. Something I found interesting with your article however, was the trade tankers being directed away from the certain ports because of the war that is ravaging the countries of Ukraine, more specifically and Russia. A question I would have for you is, how would the WTO react and need to restructure trading if Russia dropped out of the WTO?
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