Eastern Partnership and EAEU: from competition to cooperation?

_ Yuri Kofner, head, Eurasian sector, CCEIS, HSE; research assistant, IIASA. Vienna, 24 November 2017.

At present, there are two major alternative and partly overlapping economic integration processes going on in the Eastern Europe and the Caucasus. The first one is the Eastern Partnership (EaP) that is the eastern dimension of EU’s neighborhood policy launched in 2009 covering Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine. Another one is the Eurasian Economic Union (EAEU) that came into force in 2015, currently comprising besides Russia also Armenia, Belarus, Kazakhstan, and Kyrgyzstan.

The European Neighborhood Policy (ENP) is a foreign relations instrument of the European Union, which seeks to tie those countries to the east and south of the European territory of the EU to the Union. These countries, primarily developing countries, include some who seek to one day become either a member state of the European Union, or more closely integrated with the European Union.

The Ukrainian crisis shows that there is an urgent need to identify viable and acceptable-to-all strategies for economic integration across the triangle EU-EaP-EAEU. Moreover, these strategies should be tailored to each EaP country separately taking into account their specificity and also they should take into account other economic integration and cooperation processes, such as, notably, China’s Silk Road Economic Belt (SREB) project.

Researchers need to start exploring ways, in which the EaP countries can ‘optimise’ their relationships with each other, the EU and EAEU. Win-win solutions need to be identified within the legal framework of already concluded agreements, i.e., existing AA/DCFTAs between the EU and Georgia, Moldova and Ukraine; PCAs between the EU and Armenia and Azerbaijan; membership of Armenia and Belarus in the EAEU; and the CISFTA, in which Armenia, Azerbaijan, Belarus, Moldova and Ukraine are part together with Russia and other CIS countries, with the exception of Ukraine-Russia free trade that was suspended in 2016.

A number of scenarios might be considered, for example, a restoration of a fully acting CISFTA; AA/DCFTA between EU and Azerbaijan or its membership in the EAEU etc. All the scenarios are largely dependent on possible developments of the EU-EAEU economic relations. For example, in the case of a future EU – EAEU comprehensive FTA, the four EaP countries, which are not EAEU members, could be ‘linked’ to it.

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