The impending admission of Russia into the World Trade Organization is forcing the United States to reconsider a Cold War era provision known as the Jackson-Vanik amendment. That provision limited trade with Communist countries that restricted Jewish emigration. Since members of the WTO are obligated to confer “most favored nation” status on other WTO members, the continued application of Jackson-Vanik to Russia would mean that Russia would not be required, under WTO rules, to provide the U.S. with the trade concessions it made to gain acceptance into the WTO.
Senator Max Baucus, chairman of the Senate Finance Committee, has drafted legislation that would lift the Jackson-Vanik amendment as it applies to Russia. Lifting the restrictions would extend “most favored nation” trading status to Russia, also known as “permanent normal trade relations,” or PNTR. The Baucus proposal enjoys bipartisan support in the Senate including Senator John McCain (R-AZ), Ranking Member of the Senate Armed Services Committee, Senator John Thune (R-SD), Chairman of the Republican Conference, and Senator John Kerry (D-MA), Chairman of the Senate Foreign Relations Committee.
In the House, Ways and Means Chairman Dave Camp (R-MI) and Trade Subcommittee Chairman Kevin Brady (R-TX) support PNTR for Russia, and have urged the Administration to take a more active role in pressing for passage.
The business community strongly supports quick passage of PNTR for Russia. Working actively for the provision are the Business Roundtable, the US Chamber of Commerce and the National Association of Manufacturers. These groups fear that if Congress does not act before Russia joins the World Trade Organization, U.S. exporters may be left at a competitive disadvantage, since they would not enjoy the same improved access to the Russian markets as other trading partners.
The legislation is not, however, without its problems. Several Members in both chambers have insisted that any concessions on Russia trade must be tied to human rights concerns. Senator Ben Cardin (D-MD) introduced a provision, referred to as the Magnitsky bill in honor of Sergei Magnitsky, a lawyer activist who died in a Russian jail after investigating high level corruption. The bill would deny visas to and freeze the assets of individuals guilty of significant human rights violations. A version of Senator Cardin’s bill was voted out of the Senate Foreign Relations Committee last week as well as from the House Foreign Affairs Committee.
The Obama Administration supports PNTR for Russia and dropped objections to a Magnitsky-like human rights provision in order to build further Congressional support for passage. Senator Baucus has indicated his desire to move the legislation before the August recess.