Sectoral Distortions and Service Protection in Russia. A Comparison with Benchmark Emerging Markets and EU Accession Candidates
Recent research on gains for Russia from WTO membership concludes that service trade liberalization through allowing foreign suppliers to invest in Russian service industries promises large gains. By comparing OECD estimates on effective rates of protection with and without intermediate services for several countries, the paper shows that almost all Russian service industries get effectively taxed due to high tax equivalents for services. Options for European Neighborhood Policy must be based on reciprocity: the EU has to open its service markets to Russian companies in order to get access to the Russian market.