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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 Asia.

Revealing this in a recent article, Kazakhstan's Deputy Foreign Minister Samat Ordabayev described Kazakhstan as one of the main initiators of Eurasian integration.

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 principles.

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 CIS.

"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 non-tariff barriers.

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 states.

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 local suppliers.

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 post-Soviet region.

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.



Embassy of the Republic of Kazakhstan in Japan©