Will Armenia Allow Azerbaijan to Become WTO Member?

• 07.01.2016, 13:02
• Lilia Amirkhanyan
•  "Insight" Analytical Center ,  Analytics

The economic situation in neighboring Azerbaijan gets worse. The growing justified social discontent, the increasing volume of state debt and the dynamic devolution of the national currency logically should make the government embark on the search for “new life-belts.”

Despite the fact that the economic losses in 2015 that were hidden from the society has become a subject of jerky discourse since January of this year, it did not aim at objective estimation of the exiting problems and were presented in the form of suggestions to develop other branches of Azerbaijan’s economy (other than oil industry as the country’s budget almost completely is filled by the incomes from this sphere), all of it was a myth.

What is going on in Azerbaijan in reality? The budget of the country has been emptied, the previous economic "bubbles" have burst paving the path for the import of the immense volumes of debt. Simultaneously, the cases of the country’s wealth extortion by the Aliyev’s clan have been revealed which resulted in social tension. Let put aside the fact that Azerbaijan tries in every way to distract the attention of its society from that tension, as it is another problem. However, the very Aliyev himself understands that in reality the initiatives should be taken to ease that tension. And what is the most flexible index of a country’s economy? Of course, it is the trade.

Thus trying to increase the Azerbaijani narrow enough market (narrow as the country’s main focus is on the oil industry and the roles of consumers market and agriculture are small) Azerbaijan again activates the process of its membership to the World Trade Organization (WTO), which started still in 1997.

It is a common knowledge that WTO membership can be presented only in case of the agreement of all member states by the consensus principle. To reach that agreement a candidate state starts bilateral and multilateral negotiations with the member states. After clarifying some trade conditions and reaching agreements on future bilateral relations, a candidate and member states sign agreements that in essence represent the consent of the member states for candidate’s membership. It is important to note that those WTO members that have trade privilege within the organization (if the goods exported is minimum 30 %) get a privilege in negotiations and have an opportunity to present to a candidate country their conditions for a membership in advance.

In case of Azerbaijan, currently it is in early talks with RF and Saudi Arabia. Simultaneous negotiations are going on with 15 other WTO countries.

It should not be forgotten that Armenia has been a member of WTO since 2003, and in this sense our officials need to clarify their stance: should we allow Azerbaijan to become WTO member? If yes, what should be the precondition? It is obvious that Azerbaijan itself faces the need to do some reforms and to realize some obligations, without which its membership will be impossible. However, this does not allow Armenia to have a balanced stance on the issue.