EURASIAN ECONOMIC UNION SOON TO BE A
Astana, May 20: Kazakhstan, Russia and Belarus plan to adopt a treaty on the Eurasian
Economic Union this month and will work together to build a new structure,
while at the same maintaining their status as independent states on Central
Revealing this in a recent article, Kazakhstan's Deputy Foreign Minister
Samat Ordabayev described Kazakhstan as one of the main initiators of Eurasian
In his article, he recalls that the idea and necessity of creating the
Eurasian Union was first mooted by Kazakhstan's President, Nursultan
Nazarbayev, in 1994, during a speech at the Lomonosov Moscow State University.
Then, President Nazarbayev appealed to the intellectual elite of the
Commonwealth of Independent States (CIS) to withdraw from the
"stupor" of the multilateral integration process, and meet the
objective requirement of integrating participating countries.
He called for a new inter-state association that would operate on clear
According to Minister Ordabayev, that initiative by President Nazarbayev
led to the creation of several successful inter-state structures, including the
Eurasian Economic Community, the Customs Union and the Common Economic Space of
Belarus, Kazakhstan and Russia.
He recalls in his article that it took two decades to reach an agreement
on a multilateral international document to establish a free trade zone in the
"It was only in 2011, that eight of the CIS countries implemented
the agreement," he said.
This was followed by the creation of a Customs Union.
The decision to take this path was made at an informal summit of EurAsEC
member states in 2006, but it wasn't until January 1, 2010 that Belarus,
Kazakhstan and Russia created a Customs Union of their own.
"On July 1, 2011 internal customs borders between the three states
were removed," Ordabayev says in his article.
He maintains that the close cooperation between member states of the
Customs Union has resulted in a significant increase in mutual trade turnover
as well as an improvement in performance indicators for economic development.
In 2013, despite the on-going turbulence in the global economy, trade
turnover between the three countries increased, reaching USD 64.1 billion.
The structure of bilateral trade has also changed with the share of raw
materials in export-import operations declining, while the volume of
technological products with high added value has increased.
The implementation of a single customs territory, he says in his
article, has created a single market for goods where there are no tariff and
This has given Kazakh products greater access to a larger market. The
creation of joint ventures and cooperatives has intensified, new jobs have been
created, and the range of social products has expanded.
Business conditions are also improving noticeably. The members of the
Customs Union have seen an increase in their rankings in the World Bank's 'Ease
of Doing Business' Index.
With Belarus, Kazakhstan and the Russian Federation entering a third
stage of integration through the Common Economic Space (CES) in January 2012,
the free movement of goods, services, capital and labour within the single
economic space has provided significant potential for the economies of member
Since January 1, 2014, the CES states have also introduced changes into
their national public procurement regime that enable Kazakh suppliers to
participate in state and municipal tenders in Russia and Belarus, on a par with
International financial institutions have also praised the effectiveness
of the Customs Union and the Common Economic Space.
The European Bank for Reconstruction and Development's "Transition
Report 2012" described the formation of the Customs Union and the Common
Economic Space as the first successful example of regional integration in the
Leaders of these countries have agreed to ensure (1) effective
functioning of the common market for goods, services, capital and labour and
(2) the formation of a coherent industrial, transport, energy and agricultural
policy, and the deepening of industrial cooperation, including the possible
creation of joint transnational corporations.
They now hope to create a Eurasian Economic Union by January 1, 2015.
Reaching this goal requires agreement on a number of issues such as: (1)
Sustainable macroeconomic, fiscal and competition policy (2) Structural reforms
of labour markets, capital, goods and services and (3) The creation of Eurasian
networks in the fields of energy, transport and telecommunications.
According to Minister Ordabayev, the prospects and advantages of the
Eurasian Economic Union are three in number. They are: (1) Close integration on
the basis of new economic values (2) The Eurasian Economic Union will serve as
the parent organisation for all other integration processes and (3) The
Eurasian Economic Union is an open project for other partners and close
cooperation with other existing organisations, such as the EU.
He concludes by saying that believes Kazakhstan ison the path of accelerated industrial and innovative development, and
therefore, it is imperative that the Eurasian Economic Union becomes an
environment of innovation that nurtures powerful technological breakthroughs.