Integration and control in the post-Soviet space28 november 2011, 16:01
First Deputy Prime-Minister of Kazakhstan, member of the Eurasian Economic Commission Umirzak Shukeyev told Kommersant that any attempt to dominate from any of the countries in the Customs Union or the Common Economic Space may immediately stop the integration.
Shukeyev said that the issue of control in the CIS (Commonwealth of Independent States), EurAsEC (Eurasian Economic Community), CU (Customs Union) and CES (Common Economic Space) was “very sensitive”, especially considering the history of relationships in the region.
He pointed out that some Russian public opinion leaders were trying to “tune the public opinion to the idea that Russia, being economically more powerful country, has to have a greater extent control in supra-national bodies of the CES, and should have the main say in decision-making process and hold integration structure under its sovereign control.”
“There is such an opinion and perhaps there is nothing unexpected about it. However, there is a reverse side of this problem. The issue is very sensitive not only for Russia, but for other participants of our union as well. We have to clearly understand that any attempt of domination from any of the countries will immediately stop the integration. None of the countries will enter the CES unless they are offered equal rights and opportunities,” Shukeyev said.
Speaking of the political implication of the CU and the CES he said: “This is an economic project only. The final goal of creation of the Common Economic Space is elimination of all the barriers for movement of commodities, services, investments, labor resources and entrepreneurship. The political component lies only in the fact that Russia and Kazakhstan are inherently strategic partners and allies in all directions and leaning on their huge potential they are jointly playing a role of an integration core in the CIS.”
Speaking of practical results of the process, he said that 96 inter-government treaties had been signed in the framework of the Customs Union. The treaties covered tariff and non-tariff regulations, technical standards, customs and tax administration.
“This legal and regulatory framework created opportunities for free movement of commodities between our countries. There is a significant growth of mutual trade volumes. In Kazakhstan it grew 57 percent in the first 9 months of this year compared to the same period of last year,” the speaker said.
According to Shukeyev, entering the WTO remains a strategic priority for all three member-countries of the CU. “This issue has always been in our focus. We start almost every narrow format meeting of the CU Commission with discussing this issue and listening to the report of our common team of negotiators. Besides, in all our decisions, at the level of the presidents, prime-ministers, everywhere, we stress that entering the WTO remains a strategic priority for all three countries,” he explained.
Shukeyev added that creation of the Customs Union does not in any way contradict with the goals of the three countries entering WTO. “We are also at the completion stage. We have just finished bilateral talks with the U.S. and have signed the protocol. We are almost finishing negotiations with the EU, there are still several issues left and they are quite resolvable. There is a round of multilateral negotiations left. And we think that we will be able to enter the WTO next year. Of course, as long as we are a part of the CU, the issue of adjustment of common customs tariffs remains,” he said.
“We could benefit from Ukraine entering the CU and the CES. We have tried hard to get it to join us. From a perspective of economic benefit, it is pretty obvious that it is economically beneficial to enter the Customs Union,” Shukeyev said.
He pointed out that Ukraine's entering into the CU could directly increase its trade income by $6-10 billion per year. “But, probably, out of some political considerations, Ukraine is not making this decision,” first deputy of Prime-Minister said.
Shukeyev added that the free trade agreement recently signed between CIS countries was "advantageous for trade relations between Ukraine and the CU”.
“Some time earlier, understanding the economic benefits of the CU, the Ukrainian party suggested a so-called ‘3+1’ option, but this opinion is not beneficial for us. Last year Kazakhstan spent a lot of money strengthening the southern borders of the CU. It was not an easy thing to do politically: people are used to consider the borders between former Soviet states purely administrative and are used to moving freely between the countries. But respecting the economic interests of our partners, we have made a big and, unfortunately, not so popular work,” the speaker said.
“It is understandable that our partners will have to perform the same work on the remaining territory of the CU. I don’t think that this step will be welcomed on both sides of the borders. That’s why the best option for everyone is that Ukraine enters the CU and the CES,” he said.
Besides, Shukeyev said that there is no need to rush with creation of a common currency in CES countries the way it was done in the European Union. “In my opinion, the issue of creation of a single currency is not urgent at least at this stage of integration. Our countries will be pursuing their own monetary policies meeting the agreed upon parameters. Moreover, everyone knows about the problems the European Union is having with Euro. The EU experience is telling us that there is no need to rush,” deputy Prime-Minister stated.