By Irina Yeliseeva
Each union differs in scale, integration advancement and geopolitical significance but, no doubt, is closely interrelated.
Trade needs space
The major topic on the CIS prime ministers’ agenda was the discussion of a draft agreement on a free trade zone. All parties, without exclusion, see this move as an attempt to inspire new life in the CIS. As Belarus’ Prime Minister Mikhail Myasnikovich fairly notes, “Other integration structures originate from the Commonwealth.”
A free trade zone could become a symbol of the CIS’ 20th anniversary. However, a uniform decision is yet to be made. Four countries are now WTO members, while the Customs Union unites three states, which hampers consensus. Nevertheless, the Chairman of the CIS Executive Council, Sergei Lebedev, is convinced that, by October, when the heads of government meet in St. Petersburg, an agreement will be signed. “If any country refuses, it will need to agree to terms co-ordinated by the remaining sides,” he stresses. Other documents have been agreed and adopted, such as a joint programme regarding nuclear power. In 2012, a Programme of Innovative Development is also to launch.
Kazakhstan’s Prime Minister, Karim Massimov, has an unusual request, asking for support for the candidate proposed by his country for the post of IMF Director: the chairman of its National Bank. No objections have been expressed.
Right and business
The sitting of the Eurasian Economic Community’s heads of government began with a discussion on the establishment of the EurAsEC Court, which is to start work on January 1st, 2012. It is to pass legislation for the Customs Union and the Single Economic Space, while examining inter-state disputes and settling claims from economic entities. The need for such a structure has long been apparent and the Customs Union’s creation has made it even more so. Moreover, such a court is needed not only for participating members but for third countries trading within their territory. Russian Prime Minister Vladimir Putin stressed, “The EurAsEC Court aims to strengthen the efficiency and reliability of our community’s structures, while enhancing trust and interest towards them from economic operators.” Initially, it was planned that the EurAsEC Court would be headquartered in Minsk.
Later, an extended session was held, where the prime ministers listened to a report by Russia’s Deputy Prime Minister and Finance Minister, Alexei Kudrin. Using figures, he illustrated that, during the crisis, EurAsEC member states’ co-operation played a significant role in stabilising our national economies. An anti-crisis plan was adopted and a corresponding fund was created. At the forthcoming sitting, on June 4th in Kiev, the finance ministers will study applications sent to this structure by Belarus, Armenia and Kyrgyzstan. Speaking to journalists, Mr. Myasnikovich explained, “All conditions have been co-ordinated, with sums checked and approaches defined. With Russia, we’ve agreed on a $3bn allocation from the EurAsEC Anti-Crisis Fund. Probably, $3.5bn will be possible — over a three year period.” He also noted that the agreement has been fixed in a ‘matrix’ which defines how Belarus should change its economy to efficiently use the loan.
In the near future, EurAsEC member states plan to organise a direct quotation for their national currencies on the Moscow Interbank Currency Exchange, following increased demand for Russian Roubles. So far, the programme for a common market for grain, meat and milk is yet to be realised. Nevertheless, a future Belarusian-Russian company (producing and processing milk) is planned, as Belarusian Agriculture and Food Minister Mikhail Rusy tells us. A corresponding order was placed at the Union State Council of Ministers’ sitting in March. An international company is to process at least 1m tonnes of milk, integrating raw materials and sales into its assets. The EurAsEC prime ministers plan to next meet in autumn, with the venue and date to be decided.
Force of attraction
Russian Prime Minister Vladimir Putin has proposed that the next session begins by discussing issues relating to the Customs Union and the Single Economic Space. Through all other topics tackled at previous meetings, the theme of co-operation within this integration union has remained at the core. Kyrgyzstan has defined its priorities, voicing its desire to join; Belarus, Russia and Kazakhstan have agreed to hold consultations. Signals have also been sent from Tajikistan. It seems logical. With a population of 170m and $2 trillion of aggregate capital, the Customs Union is certainly attractive.
To ensure the project is attractive for others, concrete results are needed. Belarus has already ratified all documents on the Single Economic Space, while Russia and Kazakhstan are close to completing this process. On July 1st, all forms of control — including sanitary and information — are to be moved to the external borders.
Despite the Single Economic Space being not yet operational, Russia, Belarus and Kazakhstan have agreed to complete all details regarding the higher integration union — the Eurasian Economic Union — by January 1st, 2013. Mr. Putin explained shortly, “The formation of this union will ensure mutually beneficial co-operation with other countries, alongside international and regional economic associations — including the European Union.”
The configuration of this project is yet to be finally settled, but is not far off.