The Importance of Russian Trade Associations

This week a new study was published by the talented Dr. Ariel Cohen and Viacheslav Evseev about the growing importance of the Russian private sector’s role in sustaining economic ties with the United States (given that political relations are at such a low). The conclusions of this study are another reminder that it is in the best interests of all parties that Russia join the WTO (a familiar argument coming from me), giving these trade associations the opportunity to grow, and introducing Russia to a functioning international rule-based system. From Heritage.org:

The governments of Russia and the U.S. should recognize that trade associations are potential driv­ers for improving and strengthening Russia’s foreign economic ties in general and U.S.-Russian business ties in particular. They could become advocates for a more favorable business environment and invest­ment climate in Russia. To support these associa­tions, the U.S. and Russian governments should: * Encourage the development of Russian trade associations through existing civil society and market reform assistance programs and through educational and professional exchanges. In par­ticular, the U.S. and Russian governments should provide opportunities for Russian busi­ness associations to work in partnership with their U.S. counterparts. Both governments should also encourage Russian trade associations to strengthen their representative and advocacy roles by improving the quality of representation, adopting more effective management and leader­ship practices, expanding their traditional areas of expertise and services, enhancing cooperation among trade associations, and playing a more proactive role in dealing with emerging issues relevant to the industries that they represent. * Involve Russian trade associations in fighting corruption and intellectual property rights violations. Both governments should support business associations in their efforts to reduce regulation and make business decision making more transparent. Institutionalized representa­tion activity would make lobbying by business interest groups more transparent and accessible and less susceptible to corruption. * Work together to enhance the dialogue between state agencies and trade associations on bilateral economic issues. U.S. Agency for International Development (USAID) programs in Russian could support relevant educational and exchange programs for future trade associa­tion professionals. The U.S. should also: * Encourage the Russian government to recognize that trade associations play an important role in market economies and to create a more favorable operating environment by providing tax exemption to NGOs in general and to trade associations in particular.

Full study here.