Report: The Eurasian Economic Union – Expectations, Challenges, and Achievements (2019)

_ Andrei Yeliseyeu, Research Director, EAST Center. Warsaw, 15 May 2019. Published for debate.

Yeliseyeu Andrei. The Eurasian Economic Union: Expectations, Challenges, and Achievements. Berlin.: German Marschall Fund (GMF). – 25 p.

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The Eurasian Economic Union (EAEU) between Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia is the most developed institution of regional economic integration among post-Soviet states. As it reaches its five-year anniversary, it is time to assess its principal achievements, failures, and challenges.

The Kremlin’s principal reason behind pushing for the EAEU’s establishment was to create a regional bloc oriented toward Russia. A customs union and a single market are supposed to prevent the EAEU countries from drifting toward competing trading blocs or other great powers. Furthermore, Russia views the EAEU not only as an economic project, but also as a cultural and historical space built around the Russian language.

Unlike in Armenia and Kyrgyzstan, which joined the EAEU later, there was no meaningful public discussion or parliamentary deliberations over the question of Eurasian integration in the three largest EAEU countries. The overly top-down promotion of integration ultimately raises the question of its sustainability and of the EAEU’s overall viability. The union’s prospects, however, do not necessarily look bleak, for at least two reasons. First, Eurasian integration enjoys quite broad public support in all EAEU countries. Second, bureaucratic machinery and horizontal connections between the national bodies of the five members have been developing over time, contributing to the union’s viability.

The EAEU remains a four-tier organization with very limited truly supranational competences. In a few notorious cases, the decisions of the Eurasian Economic Commission (EEC) have been overruled upon Russian appeal. Hence Russia—the principal engine of Eurasian integration—does not have a coherent, unified policy toward EAEU bodies that is respected by every agency of the Russian state.

On the other hand, hundreds of other EEC decisions have not been appealed and overturned by superior EAEU institutional bodies. Generally, despite narrow EEC competences, the EAEU institutional structures and bureaucratic machinery have made progress toward establishing a single market. Many exemptions remain within the single market but the EEC has been doing considerable work to reduce their number. The EAEU’s achievements are most pronounced when it comes to creating a single labor market.

While the EAEU Court’s jurisdiction remains quite limited, there have been some remarkable achievements in its legal practice. It has moved toward fulfilling its mandate to ensure uniform application of EAEU law. Following the court’s first ruling in favor of a business in late 2018, the larger business community may become more interested in court appeals in the future.

EAEU countries have benefitted from membership to different extents. Thus far the benefits have been most pronounced for Kyrgyzstan and least for Kazakhstan. Thanks to the EAEU, Kyrgyzstan has improved conditions for labor migrants in Russia and investment, as well as begun reforming its technical-regulation system, which was virtually non-existent before the accession process began. For Armenia and Belarus EAEU membership has mostly served to retain benefits from Russian cooperation that they had before accession. Armenia has witnessed considerable increases in exports to Russia, while Belarus continues to reap benefits from its oil and gas deals and Russian loans.

Source: http://www.gmfus.org/

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