The era of globalisation according to the old rules has come to an end — there is a search for new rules and a new balance of power, including economic ones. Therefore, the Eurasian integration associations will also have to adapt to new conditions in order to remain effective, writes Sergey Rekeda, Associate Professor at the Base Department of Eurasian Economic Integration, Institute of Law and National Security, RANEPA.
The idea of modern, “pragmatic” Eurasian integration is the fruit of the heyday of globalisation. The Eurasian Economic Union was supposed to become a tool for effectively integrating Russia and its closest partners with the world economy, along with the European Union, China, and the key states of Southeast Asia. Today, however, other tasks of integration are coming to the fore — strengthening economic security and sovereignty in general.
It is no coincidence that the signing of the Treaty on the Eurasian Economic Union in 2014 almost coincided, chronologically, with the emergence of the current Ukrainian crisis. One of the key strategic objectives of this geopolitical cataclysm was to slow down the integration processes in Eurasia, including the development of the EAEU and China’s Belt and Road initiative. There was a symbolic attempt by the Eurasian Economic Commission (EEC) to establish a dialogue with colleagues from the EU. In 2015, the EEC sent a letter to the President of the European Commission with a proposal to start a dialogue between the two unions. After a long silence, the Europeans nevertheless sent an answer, but addressed it to the President of Russia — the European Commission thereby tried to demonstrate the lack of agency of the Eurasian integration project. In addition, the development of the dialogue between the EU and the EAEU in this letter was paradoxically dependent on the implementation of the Minsk agreements.
Already during this period, long-term restrictions on the development of Eurasian integration were visible, which manifested themselves most clearly after the start of Russia’s special military operation in Ukraine. At the global level, the Greater Eurasian Partnership, as a harmonious economic and social space, is not being pursued from a short-term or even a medium-term perspective. The implementation of these ideas will take decades and will not be free of conflict. They will move from east to west, rather than being Eurocentric and moving from Lisbon to Shanghai.
At the regional level, under these conditions, it is not enough for the Eurasian Economic Union to develop mainly as a trading bloc. The efficiency in ensuring the freedom of movement of EAEU goods has already been proven: the volume of mutual trade in the Union increased from 2015 to 2021 more than 50%, from 45.6 thousand to 72.6 thousand US dollars. At the same time, small economies especially benefited — the share of Armenia in the structure of mutual trade doubled over 6 years, for Kyrgyzstan it increased by 25%. Even in the face of unprecedented sanctions pressure, the reduction in mutual trade, according to the forecasts of the Eurasian Development Bank, will be comparable to the losses during the pandemic year 2020 and will be less than the reduction in trade between the EAEU and third countries. Nevertheless, the share of high-tech products in the structure of general trade is not large, and the share of mineral products in trade with external partners is even more significant than within the union. In the current situation, the union is enhancing its role stimulating industrial cooperation and establishing the region as an independent technological centre in Eurasia.
Achieving this is impossible without a more comprehensive involvement of scientific and educational institutions in the processes of Eurasian integration. In order to complete related systematic work, it is promising to create a network of basic departments of Eurasian integration in various specialties that are in demand in the integration process.
There is already a positive trend here. In 2020, the Russian Academy of National Economy and Public Administration under the President of Russia (RANEPA) in partnership with the Eurasian Economic Commission, opened a basic department for Eurasian economic integration, whose employees are involved in instructing students in special disciplines as well as relaying practical experience. Graduates of the department will be specialists in logistics and transit, which is more than relevant in the context of the break in traditional supply chains in Eurasia. A slightly different format is being implemented at Belarusian State University, where an interdisciplinary department of Eurasian studies was created in 2021. The scaling up of this experience within the framework of all countries of the union will eventually yield the necessary scientific, technological and economic effect.
At the national level, even in the face of large-scale sanctions, Russia retains its role as the main driver of Eurasian integration. The widely promoted idea in the Western media about Russia representing “only 2% of world GDP” took into account the quantitative side of the issue, but not the quality of these percentages of the world economy, which include the basic elements for international production chains. Russia remains among the world leaders in the production of not only energy resources, but also, for example, cast iron (4th place in the world), steel (5th place), and mineral fertilizers (10% of world volume); 68.5% of Russian industrial products by price and quality successfully compete in world markets and are exported. On the whole, the consolidated West’s attempt to stake on the international isolation of Russia hasn’t worked. Despite unprecedented pressure, only 41 states with a total population of 1.2 billion have implemented the sanctions. These sanctions are not supported by 80% of all countries, in which 85% of the world’s population lives and where almost 60% of world GDP is produced. The preservation of these trade and economic relations allows Russia and the EAEU countries to largely overcome Western restrictions on the export and import of goods.
At the same time, as the practice of integration within the EAEU shows, new initiatives are often not supported immediately by all the countries of the “Eurasian five”. It is more effective to implement practices that have proven their success “for two” at the level of the union. In this context, the Eurasian Economic Union may be able to borrow some experience from practices implemented in the Union State over the past 3-4 years. In addition to the intensification of joint work in the sphere of industry and education, the experience of “horizontal integration” deserves special attention here. Initially, the Treaty on the Union State dated December 8, 1999, stipulated the creation through the adoption of a Constitutional Act of an essential power vertical, including a common parliament, government, court system, accounting chamber, etc. The absence of this administrative structure did not allow for the adoption of federal laws and hampered the integration processes in the economy and the social sphere. The solution to the problem of this “slippage” were the 28 union programs signed in 2021. This package of documents is supposed to bring to life the previously unrealized economic clauses of the agreement on the Union State without creating new supranational political institutions. The departments of the two countries must harmonise “horizontally” among themselves the corresponding regulatory framework.
Such a decision really helped breathe new life into the construction of the Union State. To date, the implementation of Union State programs stands at about 30%. In addition, the Military Doctrine of the Union State and the Concept of Migration Policy, which had been waiting for a signature for many years, were adopted, the promised elimination of telephone roaming charges between Belarus and Russia was launched, etc. Energy trade between the two countries was converted into rubles, which Minsk had requested for many years in negotiations with Moscow. It is equally important that in the context of the global security architecture crisis, a general decrease in distrust in official Russian-Belarusian dialogue really happened.
In the conditions of the Eurasian Economic Union, where there is also no consensus on the need to create new supranational bodies or expand the competences of the EEC beyond the limits outlined in 2014, such a method of targeted harmonisation of legislation between the five countries could protect the union from “integration slippage”. This approach to such problems can be seen in the context of growing geopolitical risks. The threat of secondary sanctions, direct diplomatic and informational pressure, the deliberate weakening of the Russian economy, echoing in the allied countries — all this in one way or another presents politicians and individual business entities with the choice of weakening or, alternately, deepening participation within the Eurasian integration process. The era of globalisation according to the old rules has come to an end — there is a search for new rules and a new balance of power, including economic ones. Therefore, the Eurasian integration associations will also have to adapt to new conditions in order to remain effective.
The original statutory initiatives of the union, of course, have retained and even increased their relevance amid the new conditions. However, the strategic goal setting has been corrected. Now the Eurasian organisations should become full-fledged participants in the long-term “discussion” about the new balance of power. Countries outside the integration associations will not be involved in this work, and will in fact be forced to compromise their economic and political interests under the influence of external conditions, to some extent jeopardizing part of their sovereignty. The further formation of a common scientific, technical and economic pole, which was originally aimed at the Eurasian integration processes, in the context of a geopolitical storm remains the most effective mechanism for strengthening one’s own sovereignty and long-term security.