EURASIAN ECONOMIC UNION AS AN ENGINE OF ECONOMIC DEVELOPMENT IN POST-SOVIET COUNTRIES

Report by Head of the Department Sociology and Political Science, Candidate of Political Sciences, Associate Professor I.A. Kaliyev at the session of the Academic Council of S. Toraighyrov PSU

After the collapse of the USSR in the late XX century, politicians and the general public in some former Soviet republics realized the need for restoring close integration. At the beginning of the XXI century, the idea of post-Soviet Eurasian integration has become widespread.

According to the project proposed by the President of Kazakhstan Nursultan Nazarbayev, the Eurasian Union was originally supposed to include 5 republics of the former USSR: Russia, Kazakhstan, Belarus, Kyrgyzstan, and Tajikistan. Other countries, such as Armenia, Uzbekistan, and Moldova, could join the Union later.

At the turn of the XX and XXI centuries, Russia and Belarus had first created a Community and then established a Union State. However, the need for wider Union remained.

President of Kazakhstan Nursultan Nazarbayev has clearly outlined the essence of all the problems and the position of Kazakhstan regarding the establishment of the Eurasian Union. It should be noted that Nursultan Nazarbayev was the first politician to propose a large-scale integration project in the former Soviet Union territory. He expressed his idea of creating a new integration association in the CIS zone, Eurasian Union of States, in March 1994.

The essence of the proposals put forward by N.A. Nazarbayev comes down to:

First of all, development of integration primarily on the basis of economic pragmatism. Fundamental basis of the future Eurasian Union is Common

Economic Space as a large-scale area of joint development of all member states.

Secondly, the principle of countries' voluntary involvement in integration. Each state and society must come to understanding of its necessity independently.

Kazakhstan has always believed that Kazakhstan and Russia are real engines of Eurasian integration. Kazakhstan considers the Eurasian Union as an open project. It's impossible to imagine it without extensive cooperation, for example, with the European Union and other unions and associations.
Integration into the Eurasian Economic Union means not only interaction, mutual adaptation, cooperation, integration of national economies, internationalization of economic life, but also restoration of the former unity, new integrity. It requires new unifying ideas.

A treaty on the establishment of the Eurasian Economic Community (EurAsEC) was signed on October 10, 2000 in Astana. It came into effect after its ratification by all member states on May 30, 2001. Members of the EurAsEC are the Republic of Belarus, the Republic of Kazakhstan, the Kyrgyz Republic, the Russian Federation and the Republic of Tajikistan. Ukraine, Moldova and Armenia received the Observer status.

Seven years after the signing of the Treaty on establishment of the EurAsEC, the heads of three of the five states adopted the Treaty on establishment of the common customs territory, formation of the customs union and approved the Action Plan for 2008-2010 regarding the formation of the Customs Union within the Eurasian Economic Community. These documents set out the strategy and action sequence for establishment of the Customs Union of Belarus, Kazakhstan and Russia.

In early 2009, the Customs Union Commission was established with the status of an international organization. Active work of the governments of these countries, the Customs Union Commission and other Community institutions made it possible to launch the Customs Union within the EurAsEC based on the existing legal framework on January 1, 2010. Customs territories of the three countries have been combined into a common customs territory since July 1, 2011.

In December 2010, the parties signed a package of 17 basic documents regarding establishment of a new, deeper level of integration - the Common Economic Space of Belarus, Kazakhstan and Russia. After ratification of these documents in 2011, they came into effect on January 1, 2012.

Economic feasibility and importance of the common economic space is conditioned by a number of objective advantages of integration. Along with expanding the market for selling goods, the formation of a common customs territory creates the conditions for the recovery of cross-border scientific, technical and industrial cooperation of companies manufacturing products with high added value.

Another positive effect of the establishment of the Customs Union is increasing the efficiency of the transit potential of the Union. The absence of barriers on internal borders contributes to the growth of cargo transportation. In the future, it will open equal access to the infrastructure which is particularly important for Kazakhstan and Belarus, as these countries have no access to big seas. Thus, the modern Eurasian economic integration and its institutional framework are based on the convergence of the economic potentials of the member states.

The practical phase of the Common Economic Space establishment began on January 1, 2012. The mechanisms for coordinating economic policies of the three countries and free cross-border movement of services, capital and labor resources, as well as the unified legislation will become reality in the years ahead. National business entities will have equal access to the infrastructure in each member country of the CES. Common transport, energy and information systems will be formed in the future. CES will provide a firm foundation for the transition to a higher level of integration - the Eurasian Economic Union.

The main objectives of the CES formation are:

- effective functioning of the common (internal) market of goods, services, capital and labor;

- creation of conditions for stable economic development of the Parties in order to improve the standards of living;

- introduction of a coordinated fiscal, monetary, financial, trade, customs and tariff policy;

- development of the common transport, energy and information systems;

- establishment of a common system of state support for the development of priority sectors of the economy, industrial, scientific and technological cooperation.

The Common Economic Space is a deeper form of economic integration. In addition to the existing Customs Union, it includes such components as the introduction of a coordinated economic policy, ensuring the free movement of services, capital, workforce and access to the infrastructure of the CES member states.

Formation of the Eurasian Economic Union of Russia, Belarus and Kazakhstan means establishment of common market for goods with classic effects of increasing the scale and diversity, thereby improving the efficiency and growth of the economic potential of the member countries.

The process of Eurasian economic integration is carried out within the limits that are, on the one hand, set by the WTO rules and regulations and international law, and on the other hand, determined by globalization trends. Along with universal forms of regional integration, it is possible to select its particular elements as well as the limits of integration. For example, there are opportunities for both creating a common financial regulator and harmonization of financial market regulation without the common regulator.

Draft plan and the draft resolution by EEC Council “On the organization of work on the draft Treaty on the Eurasian Economic Union” were approved at the meeting held on March 12. These documents will be considered at the next meeting of the EEC.

According to the draft plan, various activities for the preparation of the Treaty on the establishment of the Eurasian Economic Union were held in 2013.

In February 2014, the draft treaty was considered for approval during the meeting of the Eurasian Economic Commission.

As of today, EurAsEC has adopted a significant number of acts on various aspects of its activities. The following basic areas of integration cooperation were outlined:

- formation of a customs union and a common customs territory;

- introduction of a coordinated economic policy;

- increased interaction in the real sector;

- joint development of the energy market;

- formation of the Transport Union and the implementation of the transit potential of EurAsEC;

- cooperation in the agricultural sector, creation of a common capital market;

- cooperation in the socio-humanitarian sphere and migration policy.

All necessary ratification procedures will take place from June to December 2014. The Treaty on the Eurasian Economic Union establishment will come into effect starting from January 1, 2015.

The current situation in the world makes the Parties look for the ways to accelerate the process of the Eurasian Economic Union formation.

The Eurasian Economic Union of Russia, Belarus and Kazakhstan, which is to be created by 2015, will become the most modern form of economic integration of the three states that already have a common customs territory and whose total GDP amounts to 85% of the total GDP of all CIS countries.