Big Eurasian partnership in contrast to US global trade expansion

« Back

Big Eurasian partnership in contrast to US global trade expansion 26.07.2016 15:31

 

With the deployment of the project of Eurasian integration in the former Soviet Union the risks and challenges diverse in its origins of its continued existence are growing. In addition to growing challenges posed by the internal logic of economic development of the EAEU, separate geopolitical challenges of external properties exist separately.

The sources of them are both the targeted actions of the US and the overall situation of the geopolitical, cultural and civilizational competition between the various integration projects and models of social and political order. These challenges demand from Russia reconciled and mutually supportive measures both in the economic and ideological space.

In this sense, a proposal for the creation of a large Eurasian Partnership (EP) voiced by Russian President Vladimir Putin at the St. Petersburg International Economic Forum is notable. In case of success, this partnership can be an effective way of counteraction to the challenges of Eurasian integration, with a complex, and not only purely economic means.

US policy principles in respect of any integration projects in the world in which the United States do not participate as the dominant subject, are accurately described by two statements - Hillary Clinton and Barack Obama.

In December 2012, the then US Secretary of State defined the attitude of Washington to the EAEU, "There is a movement toward resovetization of the region. ... It will ... be called the Eurasian Union and everything like that. Let’s make no mistake in this regard. We do not know what the aim is, and we are trying to develop effective ways of how to slow it down or prevent it". In turn, the president of the United States in October 2015 stated that "we cannot allow countries like China to write the rules of the global economy. We should write the rules, opening up new markets for American products..."

The active phase of the US struggle against the Eurasian integration at the initial stage of its existence (TU creation in 2010-2013) ended in a coup in Ukraine and its loss (hopefully - temporary) of the number of candidates for participation in the EAEU. The result here was the economic decline of the country and a serious decline in living standards of the population, depriving the original meaning of the West expansion plan for the Ukrainian market. But on the whole post-Soviet Eurasian integration, despite numerous problems of development, it has been developing in the five-nation as self-sufficient and independent project.

This fact reduces the chances of a united West to a successful expansion in the former Soviet Union in order to expand the United States and the EU market for products. A way out of the crisis at the expense of the development of new markets has long been recognized in the West, the most important component of the anti-crisis measures. This problem is solved in the colonial style, regardless of the consequences for the states - expansion of facilities, and without consultation with the other countries whose interests may be affected. The history of trade and economic gap between Ukraine and Russia and the dire consequences of drawing Ukraine into a Free Trade Area (FTA) with the EU have become paradigmatic.

Against this background, there is every reason to believe that the US initiative to establish a Transatlantic and Transpacific trade partnerships (TATP and TPTP respectively), and in fact the two free trade zones have acquired particular value for Washington and intensified in 2014-2016 not least because of the failure of the announced in 2012 by Hillary Clinton the US plan to disrupt the post-Soviet Eurasian integration.

Creation of EAEU and withdraw of Russia from FTA with Ukraine has closed for the West the possibility of unlimited and, in fact, on the colonial conditions of access to the post-Soviet market with inevitable negative consequences for the participants in the form of bankruptcy of competitive industries and the transformation of the EU and the US raw materials appendage. On an equal footing as convincingly shows Ukrainian precedent with FTA and with the EU, the West has no desire to deal with other partners.

Big Eurasian Partnership around the core EAEU-China proposed by the Russian president, can be an effective response to the association of US global markets under their dictates, and potentially, a tool of breaking new barriers in world trade, the US is trying to build up under the guise of free trade zones.

It is important that the EAEU initiative starts immediate practical implementation. In fact, the dialogue on this initiative between the Russian and Chinese leaders began, as Putin had promised, during his recent visit to China, when negotiations were started on pairing EAEU and the "Silk Road". The heads of state discussed the initiative on practical filling of EAEU and SR Integration in terms of infrastructure projects. Their implementation is just a necessary component of the formation of a large Eurasian Partnership, and in fact - a common economic space on the entire Eurasian continent.

In this case there is a situation of competition of various integration projects and socio-political models, which will inevitably be accompanied by the struggle of alternative political-ideological meanings and concepts. This creates a number of risks for the EAEU and for the FEP in the future.

Firstly, the United States and Great West in general by the creation of two FTA are trying to cut off the strongest economy in Eurasia, especially the Russian Federation and the EAEU in general, and China, two huge and capacious markets, which are very important for further economic growth - the market EU and Southeast Asia. Even in the event of renewed cooperation between Russia and the EU after the lifting of Western sanctions it will be much more difficult to return to Europe, because American rules will be valid imposed by the Europeans. EU resists the US pressure, but judging circumstantial evidence and past experience, trade wars between the US and Europe are usually ended with concessions to the latter.

Especially important for Russia are the markets of Southeast Asia. They are not so restricted, for example, the EU market and can provide effective demand for Russian goods, which are quite competitive. With the formalization of rules and regulations within TAPT it will be very difficult for the goods originating from the EAEU to come to the market. Trade regulation will be tightened by US standards, but it would create a clear competitive advantage in Southeast Asia in their favor.

Secondly, in the case of TATP difficulties in trade with the EU, which is one of the main trade partners for the neighbors of the Russian Federation in the CIS and EAEu, may dilute the incentives of some Russian partners in the Eurasian integration for further participation in this project. They may succumb to pressure from the West, and to switch to TAP even if it means loss of sovereignty and care in a one-sided specialization in the framework of the free trade area, but with the illusion of some sales guarantees at least some of their products. Moreover, the threat is enhancing by targeted US efforts to offset the ruling regimes in the CIS.

Thirdly, with the creation of TATP the US is squeezing China out of the region, for which it is the countries of Southeast Asia are the leading trade partners. Thus, on the share of participants TATP posed by Washington 35.3% of China's exports and 30.4% of Chinese imports are accounted. Agreement on TATP creates favorable conditions for the export of US goods as eliminate duties on most of them.

Fourthly, the US is likely to use TATP region to impose its own values of militant liberalism and market fundamentalism, which dramatically increases the risk of coups, the general instability in the region and it is possible again to cause all sorts of terrorist threat.

The above risks, on the one hand, make draft EAP timely, allowing countries that participate in it, to become for each other a common and very capacious market, a source of new technologies, capital, raw materials and labor, and with another - creates the necessary external incentives for associations.

At the same time in the process of creating a large Eurasian Partnership seems to avoid the risk of dissolution of the EAEU in this new project. Relative economic, political, cultural and civilizational self-sufficiency of the EAEU is obvious that the means and the president of Russia, "Eurasian Economic Union may be one of the centers of formation of a broader integration path". It is and must remain so. The risk here is the problem of reorientation of export flows of Chinese goods in the event of the successful implementation of TATP. China may try to send them to the EAEU countries, taking advantage of special privileges just the project EAP.

Under these conditions, the principal task of the EAEU is: 1) to develop in finding the best ways and channels reports of these meanings to the target audience in the countries of the EAEU and the candidates for membership of adequate new political and ideological meanings related to the goals, objectives and integration processes, 2) like in the EAEU, and the EAP.

Accordingly, the EAEU, as well as a great Eurasian Partnership needs new meanings and values that lie outside the direct economic benefits. And it was Russia and the EAEU in general, should be the bearer of such meanings.

First, the only way, ideologically, it is possible to defeat Islamic fundamentalism, which is the main threat to Central Asian members of the EAEC and by itself, and as a US tool to destabilize the Central Asian region. And secondly, the only way the Eurasian integration projects in the EAEU format and in a broader format, can win the competition in the Anglo-Saxon projects and not be preoccupied with them.

 

Dmitry Verkhovtsev

 

Link