KAZAKHSTAN AND THE EURASIAN ECONOMIC
Astana, May 29: The leaders of
Kazakhstan, Russia and Belarus met in Astana to sign the agreement establishing
the Eurasian Economic Union (EEU). The union, first proposed by
President Nazarbayev over 20 years ago, builds on the work of the Customs Union
(CU) and Common Economic Space (CES) to create a common market of over 170
million people. The union will further strengthen Kazakhstan’s economy, providing
more and greater opportunities for domestic and foreign businesses.
Ahead of the creation of the union,
there have been understandable questions over its role and the benefits to
Kazakhstan. This factsheet provides basic information on the EEU and aims to
address some of these issues.
“The aim of the Eurasian Economic
Union is not to create barriers against the rest of the world, but to improve
our cooperation with other member states. Kazakhstan, Belarus, and Russia
create the Union in a spirit of strategic partnership and friendship. The
economic integration will considerably increase economic capabilities of all
Accession to the Eurasian Economic
Union serves the economic interests of Kazakhstan
• The EEU offers great economic
potential to Kazakhstan’s economy, providing access to a common market of over
170 million people.
• This common market has significant
potential over the next two decades, with experts predicting a 25 per cent
growth in the member states’ GDP by 2030, which equates to over US$600bn.
• Since the creation of the CU and
CES, trade between Russia, Kazakhstan and Belarus has increased by 47 per cent,
exceeding US$24bn in 2013 (before joining the CU in 2009 it stood at US$12.9
1. Trade volumes of the Republic of Kazakhstan (US$ billion)
• For Kazakhstan, membership of the
CU and CES has seen trade turnover, exports and imports almost double between
2009 and 2013. In that time, turnover has gone from US$72bn to US$133bn,
exports from US$43bn to US$83bn and imports from US$28bn to US$49bn.
• According to the World Bank’s Ease
of Doing Business Index, Kazakhstan is by far the easiest EEU market to do
business in, making it the ideal choice for international businesses looking to
access the high growth common market of the EEU. This will help attract foreign
businesses and diversify Kazakhstan economy.
EEU is an economic not political union
• Foreign Direct Investment into
Kazakhstan has increased significantly under the CU and CES. Between 2009 and
2012, FDI amounted to US$99bn – over 50 per cent of the total FDI into
Kazakhstan since independence in 1991. FDI reached more than US$18bn in the
first nine months of 2013.
“The creation of our economic
union is not a frozen tenet. We are to face many challenges in the future.
The choice to integrate is not a magic wand that guarantees miracles.”
• The Commission of the EEU, the
supranational body established to promote integration, is strictly regulated by
the agreements between member states. Its powers relate exclusively to economic
• The Commission of the EEU does not
have any supranational authority over the respective Heads of State and
Kazakhstan will not support the creation of any supranational political bodies,
such as an EEU Parliament.
• The structure of the EEU
Commission and its ruling council means that no single state can dominate the
decision making process. Resolutions are based on the decision of the majority
of the Council but each state has a veto on the process. In this case the issue
is brought up to the level of the Head of States where the decision is made by
• Kazakhstan believes there is
currently no necessity to expand the role or operations of the Eurasian
Economic Commission and that its work should be clearly evaluated to ensure it
effectively fulfills its remit and delivers for all member states and their
“Any union must be based on
the principles of economic pragmatism, voluntarism, equality,
non-interference in the internal affairs of each other, respect of the
sovereignty and inviolability of the borders.”
Kazakhstan’s accession to the EEU
will not affect bilateral relations with other countries or multilateral
• The EEU will have no impact on
Kazakhstan’s other bilateral or international relations or agreements, nor its
integration into other organizations. The EEU preserves the sovereignty of each
• The EEU is aimed at facilitating
trade, both within the organization and with outside partners – not to act as a
barrier. Kazakhstan supports the proposal to create a free trade zone between
the EEU and the European Union.
• The success of the CU and the CES
is dependent on strong relationships with Europe, Asia and other regional
bodies and countries. Kazakhstan sees great potential in its strategic location
between Europe, Russia, Asia and the Middle East and will continue to promote
• The EEU does not affect
Kazakhstan’s ambitions to further integrate into the global economic community,
including accession to the World Trade Organization (WTO) and Organization for
Economic Co-operation and Development (OECD).
is no and will not be a return to the past – this is our unanimous and
unequivocal position. We do not move backwards, but head forwards to reap the
clear benefits of integration, as demonstrated by other organizations around