Russia and U.S. hold key talks on Moscow WTO entry

GENEVA, Mar 20 (Reuters) Russian and U S envoys met today in the latest attempt by Moscow to win Washington's clearance to join the World Trade Organisation (WTO) after 13 years of trying, diplomats said.

Although Russia's chief negotiator Maxim Medvedkov brought new proposals to break a deadlock over access to his country's banking and insurance markets, the outcome remained far from clear, they added.

''The United States wants its banks and insurance companies to be able to set up branches across Russia, but the Russians are making clear that they will not agree to that,'' said one official after the talks.

Countries wishing to join the WTO must complete bilateral deals with all their trading partners already in the organisation as well as an overall agreement detailing their entry terms with all member countries.

Russia, having settled entry pacts with all other major trading powers such as the European Union and Japan, is anxious to wrap up the U.S. bilateral negotiations this year while it holds the chairmanship of the Group of Eight industrial nations.

Some officials in Moscow have voiced fears that Washington is trying to use the talks to lever Russia into positions more aligned with Washington on international issues such as Iran's nuclear programme and the Middle East conflict.

U S officials deny this.

Earlier this month, Russian Foreign Minister Sergei Lavrov said he believed there was a ''political subtext'' in the U S position, arguing that Ukraine's Western-leaning administration was getting better treatment in its parallel WTO talks.

Sources close to Moscow's negotiating team said Medvedkov was expected to offer a new formula in banking and insurance that would allow foreign companies up to 50 per cent participation in subsidiary firms in Russia.

Russia had previously insisted that participation would have to be much lower. ''We will see if that is enough to convince the Americans to go ahead now,'' said one Russian source.

The U S team is headed by senior negotiator Dorothy Dwoskin from the office of the U S trade representative.

During a visit to Moscow last month, U S Treasury Secretary John Snow said the two countries were very close to a deal and insisted the United States was keen to see Russia in the trade body as soon as possible.

The Russian delegation will later in the week join a WTO session on its membership application involving a wide range of countries in the 149-nation body.

Diplomats say the overall talks in a WTO working party -- which meets again on Thursday -- have been progressing well, and that about two-thirds of the issues to be included in the final accession agreement have been completed.

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