As of 2010, 153 countries are members of the World Trade Organization (WTO). About 30 other countries, including Russia, Kazakhstan, Algeria, Azerbaijan, Yemen, Iraq, Afghanistan and the Islamic Republic of Iran (IRI), have announced their readiness to join this international structure.

Keywords: Islamic Republic of Iran, World Trade Organization, state regulation, customs tariffs.

The situation around the application of the Islamic Republic of Iran to join the WTO, submitted on July 19, 1996, was developing quite sharply. Its discussion continued for 9 years. During each round of negotiations (a total of 21 meetings were held during this time), US representatives blocked Iranians ' appeals under various pretexts [Kudaev, 2003, p.252-256]. Progress was made only at the meeting of the WTO General Council on May 26, 2005, when, after long and difficult discussions, it was decided to admit Iran to the Organization as an observer. By making concessions, Washington probably assumed that changes in the issue of Iran's accession to the WTO could be a certain incentive for softening Iran's position on the nuclear issue. However, in Tehran, this was regarded as another great success of Iranian diplomacy. Iranian officials not only did not make concessions on the "nuclear dossier", but at first assumed that in the near future their country could become a full member of the WTO.

Such bright prospects were forgotten after in December 2005, the Minister of Trade of Iran M. Mirkazemi headed a significant delegation consisting of representatives of the Ministries of Trade, Agriculture, Management and Planning Organization of Iran, as well as a number of deputies of the Mejlis, for the first time participated in the regular ministerial meeting of the WTO member countries. Following the event, he confirmed that Iran still intends to become a full member of the World Trade Organization, but the process of joining it, from the point of view of the Minister of Commerce, will be fraught with certain difficulties. According to M. Mirkazemi, the country's leadership will largely have to change its approach to production management focused exclusively on import substitution and make every effort to develop the export potential of Iran. In this vein, Iranian analysts began to talk about the fact that in order to obtain full membership in the WTO, Iran will need at least 10 years, which are necessary for significant changes in the structure of the Iranian economy and making a number of amendments to trade legislation in accordance with the requirements of the Organization.

Initially, it was assumed that the main negotiations on Iran's accession to the Organization would begin in 2006, as soon as the relevant working group was formed. According to the Permanent Representative of the Islamic Republic of Iran to the WTO, E. Omidbakhsha, it was supposed to include representatives of the European Union, some Latin American countries and the Persian Gulf states, whose readiness to take part in the consultations depended on their speedy start. However, as it turned out in the end, these hopes were justified

page 111
It was not meant to be due to the slowness of Tehran itself: the necessary memorandum on its foreign economic activities was submitted by Iran only on November 24, 2009.

The resulting four-year pause is officially explained by the significant amount of work that was supposed to be done in Tehran. Representatives of the Islamic Republic of Iran pledged to provide WTO experts with detailed information on the state of the economy and trade, trade and customs legislation, subsidies, standards, taxation system, tariffs, etc. In addition, a detailed report was to be prepared on the international agreements, treaties and conventions to which Iran is currently a party. All documentation on this issue, as well as Iranian legislation in the above-mentioned areas, was supposed to be translated into English.

The impact of the political situation on the negotiation process cannot be ignored. The idea of Iran's accession to the WTO was largely the brainchild of the reformist government headed by President S. M. Khatami (although the application was submitted under President A. A. Hashemi-Rafsanjani). Ahmadinejad, who succeeded him in 2005 with the support of the neoconservatives, was clearly not ready to continue the work of the liberals. The expansion of nuclear development, the growing confrontation with the United States and Israel, as well as a number of other political problems that have arisen have pushed the issue of joining the WTO to the background. It is possible that its current actualization can only be demonstrative and populist in nature, designed to show the external "openness" of Tehran and its readiness to cooperate with the world community in contrast to the image of an aggressive and intractable country created by the United States and some European states, whose actions are impossible to predict. It is difficult to say how much the Iranian authorities are actually ready to go all the way in the matter of joining the WTO.

In general, the discussion of supporters and opponents of joining the WTO does not subside in Iran today. The latter believe that the country's accession to it does not meet the national interests and is fraught with its transformation into a raw material appendage and a market for goods of industrialized countries. Assessing the negative consequences of the IRI joining the Organization, they quite objectively refer to the possible deterioration of the social situation in the country and the decline in the competitiveness of goods of entire sectors of the IRI economy (primarily agriculture) [Abadchi, 1386*, pp. 32-38]. However, with the passage of time, the number of ardent opponents of joining the WTO is noticeably decreasing. Today, most Iranian researchers, as well as Iranian officials, expect to receive a number of tangible benefits from membership in the Organization, such as::

* creating more favorable conditions for access to world markets for goods and services based on transparency, predictability and stability in the development of trade relations with WTO member countries;

* Access to the WTO dispute resolution mechanism, which protects national interests if they are infringed by partners, and thus eliminates discrimination;

* the ability to implement their trade and economic plans by effectively participating in world trade policy when developing new rules for international trade [Gilanpour, 2006, p. 7; Abadchi, 1386 (2007/2008), pp. 32-38].

To confirm the seriousness of their intentions, from 1999 to the present, the country's leadership has taken a number of steps designed to make qualitative changes in the structure of the Iranian economy, to make it more transparent and open to the outside world. In particular, a single exchange rate was established, a more liberal law on attracting and protecting foreign investment was adopted, and the introduction of a new tax code was announced.

* 1386 years of solar Hijri - according to the calendar adopted in Iran, i.e. 2007/2008.

page 112
Finally, the process of forming a legislative framework to combat corruption and money laundering, as well as to protect copyrights, has begun. It is also planned to conduct a full-scale monetization of benefits and reduce the volume of state subsidies.

The most significant changes were made in the sphere of customs regulation of foreign trade, which began in 2000-2003. Until then, the main instrument of state intervention was non-tariff barriers (quotas, licensing, currency controls, subsidies, and administrative measures). Tariff methods of regulation (customs duties, fees and the so-called commercial profit tax1) were practically not used. General level of customs duty for 2000 it was only 2.7% [Iran. Trade..., 2001, p. 10].

In 2002-2003, as part of the program to prepare the country for WTO accession, Iran significantly replaced non-tariff methods of regulating foreign trade with tariff equivalents based on ad valorem customs duty. After that, the average rate of customs duties levied in Iran for all imported products was about 30% [Islamic Republic of Iran..., 2004, p. 14]. Moreover, the average indicator for agricultural products in 2002 was at the level of 23.5 - 24.5%, which was significantly less than the average for developing countries [Gilanpour, 2006, p. 7; Islamic Republic of Iran..., 2004, p. 14]. This allowed the Iranian leadership to make a statement as part of its future plans to join the WTO on the possibility of further reducing tariff barriers to imports of agricultural products, which was to be accompanied by a complete rejection of non-tariff regulatory methods, as well as a significant reduction in the level of state support for agricultural producers.

However, according to experts, the steps taken by the Iranian government have not yet led to drastic changes necessary to prepare Iran for WTO membership. Recently, in some cases, there has even been a certain rejection of previously made decisions. In particular, the discontent that arose within the country among manufacturers with the initially low customs duty, which did not meet the level of abolished administrative barriers, as well as the uncompetitiveness of domestic goods that very soon made itself felt, led to the fact that official Tehran was forced to partially abandon its initial plans to reform the system of foreign trade regulation.

Since about 2004, there has been a gradual increase in the average customs duty. Since 2007, it has been about 35% for agricultural products, which is quite consistent with the general trend in developing countries, where the average rate for imported agricultural products is traditionally higher than the general average [Gilanpour, 2006, p. 7]. Non-tariff barriers were also not completely eliminated. As a result, the administrative procedure for documenting export-import transactions remains very complex. According to the World Bank, the export of one container of goods from Iran in 2010 will require 7 documents and will cost about $ 1,061, which will take a total of 25 days. For comparison, the main regional rival of Iran and the current member of the WTO - Saudi Arabia, these indicators are equal to 5 billion, 681 US dollars and 17 days. In turn, passing customs procedures for a container imported to Iran will take 38 days, require 8 documents and payment of $ 1,706 (18.5, 678 for Saudi Arabia, respectively) [Doing Business... 2010, p. 39].

According to experts, the Iranian economy is not ready to reduce the level of domestic state support for domestic producers (especially significant is a number of benefits for the purchase of fuel and means of production). According to various estimates, the total amount of subsidies (provided to both consumers and producers) is estimated to be:-

1 In essence, this is the same customs duty, the rate of which is determined not by the parliament, but by the government.

page 113
In 2009, the total investment in Iran amounted to about $ 90 billion. Even a possible reduction to US $ 50 billion in accordance with the reform program proposed by the Ahmadinejad government may lead to an increase in the cost of production of goods by 75.8% and consumer prices by 59.6% (all this without taking into account the rather high natural growth rates of these indicators) .2
In turn, the jump in prices for domestic products, which occurs against the background of a decrease in the cost of imported goods due to the reduction of customs barriers, will significantly reduce the competitiveness of Iranian producers, who are already experiencing difficult times. The most serious blow will be dealt primarily to the agriculture of Iran, as the main producer of agricultural products in Iran continues to be small, poorly mechanized peasant farms united in marketing or multi-purpose cooperatives. The 2003/04 Agricultural Census in Iran showed that 73% of allotments of less than 5 hectares are owned by Iranian farms [Nataej..., 1383, p. 43]. On average, each peasant has 2 hectares of land [Rezvani, 1383, p. 4]. It was experimentally established that in the conditions of Iran, the minimum land area that would meet the needs of an average family and start supplying products to the market is 7 hectares (Schirazi, 1987, p. 8). In a situation where 73% of farms own less than 5 hectares, the only possible mechanism for activating their market activity is state support. Its immediate or rapid cancellation in Iran will lead to an economic crisis and ruin of the main producers.

According to some estimates, the reduction of state support in the framework of WTO accession, along with the reduction of customs barriers, may also have negative social consequences. In the short term, they will lead to a decrease in the purchasing power of the population due to a significant increase in prices for domestic products. Thus, only partial elimination of fuel subsidies can lead to a significant increase in the cost of agricultural products (chicken meat by 69%, chicken eggs by 67%, milk by 76%, beef and lamb by 46-47%), which is very critical in the conditions of low living standards in Iran. The subsequent reduction in prices due to the influx of imported goods, as noted by Iranian researchers, will remove the urgency of the issue, but actualizing, however, another problem: in conditions of growing competition, Iranian producers will begin to optimize their production by using new (and earlier, in conditions of low competition, unnecessarily expensive) means of production, leading to a decrease in employment in a number of sectors of the economy. First of all, this will affect the agricultural and industrial complex, textile production, the service sector, and the energy sector (with the exception of oil production). In other industries, Iranians believe that the demand for workers may increase, but first of all, qualified personnel will be in demand, and the country may face a shortage of them [Mehpapa, 1983, pp. 171-194].

Experts view the actions of the Iranian leadership in attracting foreign direct investment (FDI) and protecting intellectual property with a certain degree of skepticism. So far, egregious violations in the areas of copyright compliance have not been eliminated. Iran, although a member of the World Intellectual Property Organization (WIPO), has acceded to a number of international conventions, but has not signed a copyright agreement. The existing domestic legal framework protects only Iranians, but not foreigners. Copying and distribution of information technologies, printed and video products reaches a huge scale in Iran, and in some cases is supported at the state level. The West's hopes that joining the WTO will force official Tehran to start a fight against terrorism are violated.-

2 According to the calculations of the Mejlis Research Center: [http://www.majlis.ir/mhtml/].

page 114
However, the issue of copyright issues is questionable, as representatives of the Islamic Republic of Iran have repeatedly expressed their disagreement with the restrictions imposed on this issue by the World Trade Organization [Security fears..., 2004; Business Monitor International..., Q2, 2009].

The new law on attracting and protecting foreign investment adopted in 2002 proved to be an undoubted step forward for Iran, where foreign direct investment was difficult after 1979. This document provided foreign investors with national and most-favored-nation treatment, which fully complies with WTO requirements. Moreover, in case of violation of the agreement by the Iranian partner, the state has undertaken to recover all or part of the losses (depending on the agreement). Foreign capital has few restrictions on export, which ensures its liquidity, and also exempts when investing in export-oriented production from going through a number of administrative procedures that are unavoidable for Iranian companies.

At the same time, there are some restrictions in the 2002 law: foreigners are still prohibited from buying up land and taking ownership of the country's natural resources. Discontent among foreign companies is caused by restrictions on investing in the energy sector, as well as basing the main part of contracts in this area on the "by-back" scheme (investments are returned in the form of products produced directly or indirectly with the help of created/imported equipment). In fact, the banking sector is still closed to FDI. Periodic statements made by Iranian officials about the imminent launch of representative offices of foreign financial institutions outside the Iranian free economic zones have not yet been confirmed. The process of creating joint interstate banks is slow (only the Iran-Venezuela project is being implemented most successfully). The main deterrent here remains both an undeveloped legal framework and the existing ban on conducting operations using the interest rate.

Iran, as a candidate country for full WTO membership, receives the greatest complaints when discussing the existing FDI regime for significant administrative risks. Strong government intervention has been a major drag on foreign investment. Moreover, the Iranian government's policy on this issue is known for considerable variability. In particular, due to internal Iranian disagreements, contracts with Turksel, a Turkish mobile operator, and TAB, a Turkish-Austrian company that was supposed to operate the new Imam Khomeini airport in Tehran, were terminated without justification from the point of view of international legal norms. In 2007, without explanation, Iran refused to provide the Indians with the Jofeyr oil field it had promised, handing it over to Belarusians. Later, the situation was repeated with the North Azadegan oil field, which was supposed to be developed by Russian companies instead of the Chinese, according to previously reached agreements. All this reduces the confidence of foreign investors in Iran and makes them fear for their invested capital. Strong bureaucratization, bribery, and a well-developed system of state control have led to the fact that local officials are afraid to make decisions or look for their own benefit in them. Therefore, negotiations on the participation of foreign investors in joint projects have been going on for years. As a result, in its annual review, the IBRD ranked Iran as one of the least attractive countries (165th out of 183) for FDI in terms of ensuring their security [Doing Business..., 2010, p. 28-31].

Summing up, we can say that today there are a number of problems that need to be solved in the way of Iran's accession to the WTO. Local economists, who mostly support the idea of joining the World Trade Organization, still demand that the government carefully weigh every step in this direction. First of all, two points are of concern: the decline in the competitiveness of the Russian economy.-

page 115
the state economy and possible shocks in the social sphere. After joining the WTO, Western companies will inevitably come to Iran, which the Iranian domestic market is not yet ready to accept without negative consequences. Based on this, we can predict a rather long negotiation process between Tehran and the WTO, aimed at negotiating the most favorable conditions for the restructuring of the Iranian economy, in order to give the domestic producer as much time as possible to adapt to the requirements of the Organization. In addition to economic difficulties, there are also a number of significant political difficulties, primarily related to the development of the situation around the Iranian nuclear program. All this allows us to consider the 2017 year declared by the Iranians as the time of their accession to the WTO as a very approximate date, in which they most likely will not meet.

list of literature

Kudaev S. M. Iran and the WTO / / The Middle East and Modernity. Moscow, 2003. N 17.

Business B. Business Monitor International: Iran Pharmaceuticals and Healthcare Report. Quarter 2, 2009.

Doing Business. Iran, Islamic Rep. Washington, 2010.

Gilanpour O. Challenges of Iran s Agriculture Sector in Accession Process to the WTO. Vienna, 2006.

Iran. Trade and Foreign Exchange Policies in Iran. Reform Agenda. Economic Implications and Impact on the Poor / Ed. D. Tarr. Washington, 2001.

Islamic Republic of Iran. An Agricultural Policy Note. Report N 29428-IR. Document of World Bank. Washington, 2004.

Schirazi A. The Problem of the Land Reform in the Islamic Republic of Iran. Complications and Consequences of an Islamic Reform Policy. Berlin, 1987.

Security fears spark Linux drive in Iran // The Agn. 2004. September 21.

Abadchi A. R. Peyvastan-e Iran be sazman-e tijarat-e jahani dar bakhsh-e keshavarzi (Agricultural aspect of Iran's accession to the WTO) / / Fanavari va tousee-ye sanat-e bastebandi (Technologies and development of the packaging industry). No. 49. 1386 p. k. (2007-2008).

Mehrara M. Barrasi-ye asar-e kahesh-e tarafe az tarig-e elhag-e Iran ba WTO bar bahshha-ye egtesadi (Study of the impact of reducing customs tariffs in the framework of Iran's accession to the WTO on the sectors of the economy) / / Tahgigat-e egtesadi (Economic Research). 1483 (2004/05). N 80.

Nataej-ye tafsili-ye sarshumari-ye amumi-ye keshavarzi (Detailed results of the General Agricultural Census of 1382 (2003-2004)). 1382 p. k. Tehran, 1383 p. k. (2004-2005).

Rezvani M. R. Muqaddame-i bar barnamerizi-ye tous '-ye rustai dar iran (Introduction to the Rural Development Planning System in Iran). Tehran, 1383 c. h.

page 116

Permanent link to this publication: