European and Eurasian integration: possibilities for a new interface

June 1st, 2017 a panel session “European and Eurasian integration: possibilities for a new interface” was held as part of the SPIEF 2017. The event was attended by the director of the Center for Eurasian Studies and IIASA research assistant Jurij Kofner.

The Eurasian Economic Union can become a development hub for a more encompassing ‘Big Eurasia’ project. Today’s agenda is extremely urgent for all concerned parties, with particular attention being paid to energy, transport and infrastructure, migration, and other issues. Many in European business are ready to cooperate and there is an interest in developing relations with EAEU economies. How can structural cooperation between the EU and the EAEU be fostered and is it possible to strike a comprehensive cooperation agreement? Will the global surge in protectionism impact the feasibility of a ‘Big Eurasia’ project?

The participants of the discussion were: Moderator: Tigran Sargsyan, Chairman of the Board, Eurasian Economic Commission. Panellists: Antonio Fallico, President, Conoscere Eurasia Association; Chairman, Board of Directors, Banca Intesa; Vache Gabrielian, Vice Prime Minister, Minister of International Economic Integration and Reform of the Republic of Armenia; Sergey Karaganov, Dean, School of International Economics and Foreign Affairs, National Research University Higher School of Economics; Honorary Chairman of the Presidium, Council on Foreign and Defence Policy; Viktor Khristenko, President, Business Council, Eurasian Economic Union (EAEU); Alexander Machkevitch, Chairman of the Board of Directors, Eurasian Resources Group S.a.r.l. (ERG); Philippe Pegorier, President, Alstom Russia; Member of the Board, Association of European Businesses (AEB); Front row participants: Grigory Rapota, Secretary of State, The Standing Committee of the Union State; Frank Schauff, Chief Executive Officer, Association of European Businesses; Jean-Pierre Thomas, President, Thomas Vendome Investment; Evgeny Vinokurov, Director, Centre for Integration Studies, Eurasian Development Bank (EDB).

Tigran Sargsyan, Chairman of the Board of EEC and Sergey Karaganov, Dean of the Faculty of World Economics and International Policy at the HSE. Section “European and Eurasian integration.” 

Conclusions

  • The EU is gradually losing ground as the main trading partner of the EAEU and Russia

“In 2016 – for the first time ever – the EAEU’s imports from the Asia Pacific countries exceeded those from the EU – by 3.8%, and in Q1 2017 – by 8.5%,” said Tatiana Valovaya, Minister in Charge of Integration and Macroeconomics, Eurasian Economic Commission.

“When we finally get our dialogue restored, say, in some five years, the landscape will be entirely different. Russia’s Asian (not only Chinese) trade share will stand at 40%, while Europe will account for 40–42% – this will be the new reality,” said Sergey Karaganov, Dean, School of International Economics and Foreign Affairs, National Research University Higher School of Economics.

  • The European business is ready to expand the dialogue to pursue broader opportunities

“I can confirm that the European business is not waiting for any political decisions, judging by the number of enquiries and requests we are getting from them. They show a lot of interest in our newly adopted technical standards and regulations. We are not going to wait either and are ready to expand our collaborations with the European partners,” said Tigran Sargsyan, Chairman of the Board, Eurasian Economic Commission.

“Of course, we have the sanctions. But, first, the sanctions are not eternal. And nobody can forbid us to restart this conversation,” said Jean-Pierre Thomas, President, Thomas Vendome Investment.

  • During the session, Tatyana Valovaya, member of the Board (Minister) of the EEC on development of integration and macroeconomic policies, conducted a survey among the audience (mostly business leaders, as well as former and current representatives of the state bodies of the EU and the EAEU). The results were as follows:
  1. Who is the most preferable trade partner for the EAEU? Answer: EU (42.3%); China (12.7%); APEC region (11.1%); all regions are equal (4.9%).
  2. Is European business ready for real cooperation with Eurasian business, taking into account the geopolitical circumstances? Answer: Yes (70.5%); No (29.5%).
  3. If not taking into account geopolitical realities, would consider the conclusion of a comprehensive agreement between the EU and the EAEU desirable? Answer: Yes (79.5%); No (20.5%).

Challenges

  • Many unaddressed administrative and regulatory barriers

“The European business is somewhat disappointed with Russia failing to comply with the WTO rules in whole or in part,” said Philippe Pegorier, President, Alstom Russia.

“Examples are customs rules and procedures, plant health checks, different and diverging standards, rules and regulations, certification, registration, documentation, you-name-it-ation.” “Such inconsistencies and contradictions hamper business and create another frustrating barrier,” said Antonio Fallico, President, Conoscere Eurasia Association; Chairman, Board of Directors, Banca Intesa.

“We should strive to harmonise the EAEU and EU standards <…>. We have so many technical issues that it will take a decade to address them,” said Alexander Machkevitch, Chairman of the Board of Directors, Eurasian Resources Group S.a.r.l. (ERG).

Viktor Khristenko, President of the EAEU Business Council, Chairman of the Board of the EEC (2012 – 2015).

Solutions

  • Talks in a variety of formats are needed between integration structures as well as between nations

“The EU has multi-format relations with the EAEU states. <…> The EAEU states have a set of formats to interact with the EU. Is anyone able to manage the development and understand the future in such circumstances? I am 100% sure, no one is,” said Viktor Khristenko, President, Business Council, Eurasian Economic Union (EAEU).

“On January 1, 2018, the EAEU Customs Code comes into effect. So, this set of matters will be subject to discussion between the EU and the EAEU as a whole, not its separate member states. This opens up a way for discussion of a common economic space from Lisbon to Vladivostok,” said Antonio Fallico.

“Romano Prodi [former President of the European Commission] put forward an initiative to arrange an informal meeting between the European Commission and the Eurasian Economic Commission at the 6th Eurasian Forum. Now we are working hard to make such a summit in Verona in October 2017 a success,” said Antonio Fallico.

An international research project “Challenges and Opportunities of Economic integration within a wider European and Eurasian Space” is being conducted at IIASA (Laxenburg, Austria) with the aim to discuss, analyze, and critically evaluate the potential for the creation of a common economic space between the European Union (EU) and the Eurasian Economic Union (EAEU).

CES

Base on material provided by http://tass.ru/

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