Valdai Club

More than five years since the signing of the Treaty on the Eurasian Economic Union, we can confidently say that the EAEU realised itself as a successful regional integration association. By developing relationships within the organisation, the member countries of the Union continue to pursue a progressive economic cooperation policy.

It should be noted, that over the past years, mutual trade in goods between the EAEU member states have shown steady growth. So, in 2016, the volume of mutual trade amounted to $ 43 billion, while in 2017 this figure increased by 27.3%, reaching $ 54.7 billion. According to the 2018 results, trade grew by 9.2% to $ 59.7 billion. Although the figures for the first quarter of 2019 indicate a decrease in trade volumes by 7% compared to the same period last year, it is too early to talk about a serious slowdown.

As far as Kazakhstan goes, the share of the country's mutual trade in the total volume of foreign trade of the EAEU in the first 3 months of 2019 increased to 21.8%. Although the volume of Kazakhstani exports to the EAEU market decreased by 4.8%, the share of the republic in mutual exports and imports increased to 10.2% and 23.3% respectively.

In general, the member countries are faced with the task of preventing the integration reforms from weakening the EAEU. The experience of joint consultations allows the member countries to expect, in the future, a qualitative change in the structure and proportions of mutual trade. The daily work on the coordination of economic cooperation issues, primarily within the Eurasian Economic Commission, clearly shows that there are incentives to overcome difficulties.

It is obvious, that the current agenda of interaction cannot do without the discussion of problematic issues. Despite the fact that, on the whole, the parties were able to successfully agree on common approaches in the field of trade, the problem of the existing barriers, exemptions, and restrictions that do not allow the member states to fully realize the integration potential of the EAEU, remains unsolved. At the initial stage, the presence of such obstacles made it possible to facilitate the process of the Union’s formation. However, in order to increase the internal trade turnover with guarantees, it is necessary to continue working on the removal of existing barriers, thereby moving systematically towards the formation of common markets for services, capital and labour. In this context, the desire of the Supreme Eurasian Economic Council members to achieve progress on the treaty on the provision of pensions for workers of the EAEU member states, the creation of a common oil and gas market, and the establishment of a common financial market becomes very clear. In addition, the macroeconomic benchmarks of the EAEU presume the strengthening of the focus on industrial cooperation within the framework of the Union.

The work carried out within the Union to improve the technical trade regulations has become the key to creating favourable conditions for the transition to the implementation of more global tasks. In particular, this means the expansion of the EAEU’s international activity. First of all, the member states are interested in increasing cooperation with partners who have expressed a desire to develop economic ties in the form of a FTA. Last year, China and Iran joined the list of countries that signed corresponding agreements with the EAEU. In 2019, similar negotiations with Serbia and Singapore are at the completion stage. Active work in this direction is also being carried out with other states, such as Israel, India and Egypt.

The demand for the development of interaction with key integration associations within Greater Eurasia, where the EAEU has a chance to become a “centre of gravity”, is becoming increasingly obvious. At the same time, the most promising process, in this respect, is the implementation of the confluence between the EAEU and the Chinese Belt and Road initiative. Moreover, the EAEU medium-term plans envisage the launch of trade liberalisation talks with ASEAN and MERCOSUR, with which memorandums of understanding have already been signed. On the agenda is a similar document with the African Union. In the future, similar consultations are planned to begin with the EU.

Finally, an important point is the expansion of the strategic contours of the EAEU. It should be noted, that as the process of economic integration continues to deepen, it will be necessary to strengthen the positions of the EAEU in the WTO, which underscores the need for obtaining observer status in this international organisation.

The meeting of the Supreme Eurasian Economic Council (SEEC) on May 29, 2019, in Nur-Sultan became symbolic in many ways. First, the outgoing president of the Republic of Kazakhstan, Nursultan Nazarbayev, got the title of Honorary Chairman of the SEEC, which safeguards the commitment of the member countries to consistently implement the ideas of Eurasian integration. The anniversary meeting was dedicated to recognising achievement and formulating new large-scale tasks. For example, the heads of the EAEU member states stressed the need for projects that unite all the participating countries in the format of large allied industrial companies. The need to enhance the attractiveness of the EAEU as an organisation was emphasised, one capable of making coherent decisions and implementing infrastructure megaprojects. Measures to revitalise the digital agenda had the unanimous support of the participants; this would allow the countries of the Union to fully exercise their digital sovereignty.