Russia's bilateral negotiations with the U.S. over its bid to join the world's largest trade body broke down in July over differences on agriculture, specifically meat. This was an unexpected development, since the main point of contention throughout the talks has been the lack of protection for intellectual property rights in Russia.
"We have reached a critical point beyond which there may be no further retreat. We cannot give way anymore now. The situation with the United States is about the same: It has also reached a critical point," Igor Shuvalov said.
He said the Russian government could make some unconventional decisions on WTO accession, but that there was no desire to join it at any price.
"The government may decide to suspend the process and then restart the talks [at a later stage]," he said.
He said Russia's WTO negotiations with the U.S. might not be completed by October, as agreed previously.
Moscow wanted to sign a protocol with Washington at Russia's debut summit of the Group of Eight nations, but the deadline was moved back to October.
The U.S. currently enjoys concessions under agreements signed between the two countries in 2005, which will remain in force until 2009. The agreements raised quotas on U.S. supplies of poultry meat to 1.2 billion metric tons, of beef to 450,000 tons and of pork to 502,000 tons. Gordeyev said the United States earns about $1 billion on poultry meat exports to Russia annually.
The Economic Development and Trade Ministry earlier warned that it would review the agreements on meat imports from the U.S. if WTO talks in October were a failure.
Minister German Gref sent a letter to the U.S. saying that, pending Russia's accession to the WTO, it would be forced to resume the position it maintained before the agreements on meat imports was reached.
Gref also said the Russian government could not, under these conditions, continue ignoring the demands of Russian farmers to revise meat quotas and abolish concessions offered to the U.S.
Agriculture Minister Gordeyev said the ministry planned to reduce meat imports to 20% of the market within three years, with the other 80% to be supplied by domestic producers. Experts said imports currently account for 50% of Russia's meat market.