About a month ago I returned from Russia where I met my family and discussed current projects with our clients and partners. The main news which was discussed actively there was the following: Russia formally joined World Trade Organization after more than 18 years of negotiations! So, what does Russia’s WTO entry mean for us, exporters, importers and those who help them?
As you may know, as a WTO member Russia committed to comply with WTO agreements, lower import tariffs on goods agriculture and manufacturing products, ease foreign investment access and assure protection of investments. At the same time, other WTO members committed to removing trade barriers for Russian goods. Although not all WTO rules apply instantly, many tariffs have already been slashed in Russia and other WTO members states.
So, now it is a good time to enter world’s ninth biggest economy, worth $1.8 trillion annually!!! Just imagine!
Probably, you have a question: what can you do right now?
I recommend you to identify if there is a sufficient demand on your product in Russia. There is a quick algorithm to do it. It’s an easy, quick and useful calculator!
So, let’s start!
1. Use UN Comtrade database http://comtrade.un.org/db
2. Choose “Russian Federation” in “to” field
3. Choose Your Country in “from” field
4. Type commodity/product type in “of” field
5. Hit “Search” button
6. Select one category from the result that describes your product the most.
7. Click “View Trade Data” button
8. Calculate average import volume for the last 5 years in natural units, kilograms, square meters whichever is applicable
9. Divide average on the population number of your demographic grouphttp://www.census.gov/population/international/data/idb/informationGateway.php – take from here
10. Compare with domestic consumption per client. If Russian consumption is way less than you sell per client, then there is likely a market for you.
Although this methodology is missing domestic production it may be a good starting point.
To learn more about trade barriers, business practices, due diligence and more on entering the Russian market in such a good time from the first hands, contact Win Global Partners now!
Please share in the comments below your positive or/and negative experience in the Russian market and how you handled it.