On the way to the large Eurasian partnership: challenges and opportunities

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On the way to the large Eurasian partnership: challenges and opportunities 17.07.2017 12:34

The concept of the "Great Eurasian Partnership" (GEP), which is being formed before our eyes, has already caused controversy in scientific and social circles, and most importantly - the desire to adequately comprehend it, analyze the challenges and opportunities it is bringing.

As you know, the idea of creating a Greater Eurasian partnership was formulated on December 3, 2015, when V.V. Putin in the President's Address to the Federal Assembly put forward an initiative to start consultations on the formation of an economic partnership between the member states of the Eurasian Economic Union (EEU), the Association of Southeast Asian Nations (ASEAN) and the Shanghai Cooperation Organization (SCO) and the states that join the SCO. Throughout 2016, the concept was repeatedly discussed at various multilateral discussions and in the expert environment, becoming, in fact, the flagship Russian initiative for the development of Eurasian integration. (1)

At the same time sometimes polar points of view were expressed. Thus, according to one of them, expressed in a polemical pointed form, "the most absurd mistake would be the desire to use the chance to advance now in the APR the monster that was born in the depths of bureaucratic and expert offices in response to the Trans-Pacific Partnership (TTP) - Economic partnership of Greater Eurasia. This geoeconomic chimera, in contrast to the same TTPs or the Comprehensive Regional Economic Partnership (CREP), does not have clear outlines. Asian and European diplomats laugh that no one in Moscow has ever been able to name at least three specific mechanisms for the work of this partnership and three reasons why some country should strive to join it". (2)

On the contrary, as noted, for example, M. Entin and E. Entina, "in the history of the political initiative for the creation of GEP, first it was a matter, and then a word ... In the speeches, the Russian leader gave a description of the fundamental principles under which GEP should be formed. He stressed that its foundation will be the SCO, the EAEU and the interface of the "Economic belt of the Silk Road" (EBSR) with the activities of the EAEU. He spoke about the economic, energy and infrastructure projects that could be implemented in the framework of the GEP. He also encouraged Asian and European countries to cooperate in the implementation of GEP. Thus, it is initially clear what content is invested in the initiative to build a GEP. What it will be like if implemented. In what directions will its formation take place. What it will rely on". (3)

GEP also has deep historical roots. In conceptual terms, it dates from the time of the sharpest political battles between the Slavophiles and Westerners. The essence of the controversy, the echoes of which have been heard so far, boiled down to the choice of the path of development. There were discussions then, as now, was about whether to go in the wake of Western civilization or bet on your own, specific, independent way of development. Are there universal recipes to be followed, or proceed from the premise that each society must suffer certain social and political decisions, be convinced of their correctness and acceptability.

But, moving away from polemics, it is much more important to understand the geo-economic underpinning of the emergence of the GEP idea, rational motives by which it can be justified. It seems that the most significant of them is an objective assessment of the possibilities of Eurasian economic integration within the framework of the EAEU in the short and medium term.

So, against the backdrop of the grandiose shifts in global integration and trade and economic processes to some domestic experts, the development of the EAEU is lagging behind them. They state that this union today with its GDP of $2.2 trillion, amounting to 3.2% of the world, does not constitute a self-sufficient The market and any attempts to build the "fortress of Eurasia" are suicidal. The way out of the situation is the activation of the negotiation process on two tracks - eastern and western. (5)

It is significant that this approach is shared by both "market liberals" and "dirigists". To compensate for the relatively small weight of the EAEU in the world economy, they believe, it is possible only within the framework of the external outline of the Eurasian integration, building preferential regimes of trade and economic cooperation with the rapidly growing countries of Eurasia - China, India, Indochina, Middle East. The implementation of the initiative of the leaders of Russia and China to link the two transcontinental integration initiatives - the EAEU and the Silk Road - opens up opportunities for the sustainable economic development of Eurasia. These initiatives can organically combine, complementing and multiplying the integration effect of each of them. In this scenario, for example, S.Glaziev predicts, the growth rates of the Russian economy reach the maximum values - up to 10% of annual GDP growth and 20% of investment growth. (6)

Another significant and very rational motive for the promotion of the GEP idea is Russia's concern about the decline of the authority of the World Trade Organization (WTO) and the creation of "closed" regional trade associations. In response to this challenge, the thesis of harmonizing various regional economic formats is advanced with strict adherence to the principles of equality and openness - that is why, as a positive experience, Vladimir Putin described the activities of the EAEU and the negotiations on its interface with the Chinese EBSR project, which in the long term can contribute to the creation The great Eurasian partnership, open to interaction with all interested states and integration unions. (7)

Vladimir Putin, who first put forward the idea of GEP in his address to the Federal Assembly of the Russian Federation in December 2015, emphasized that this partnership should be based on the principles of equality and consideration of mutual interests. (8) Developing this idea in a speech at the plenary session of the St. Petersburg International Economic Forum (SPIEF) in June 2016, he noted: "We with our partners believe that the Eurasian Economic Union can become one of the centers for the formation of a broader integration path ... We could rely on a whole network of bilateral and multilateral trade agreements with varying depth, speed and level of interaction, openness of the market, depending on the preparedness of a national economy for such a joint work Those on agreements on joint projects in the fields of science, education, and high technology. (9)

Returning to the idea of GEP at the final plenary session of the 13th annual meeting of the Valdai International Discussion Club on October 27, 2016, Vladimir Putin again stressed: "Russia advocates the harmonization of regional economic formats based on the principles of transparency and respect for each other's interests. This is how we build the activities of the Eurasian Economic Union, we are negotiating with our partners, including the interface with the China-implemented project of the "Economic belt of the Silk Road." We expect that this will allow the creation of Greater Eurasian partnership ... For the implementation of this idea, negotiations have already begun in the "five plus one" format on an agreement on trade and economic cooperation between all participants in this process". (10)

The need to create Greater Eurasian partnership between the EAEU and other countries, including China, India, Iran, Pakistan and CIS partners, the Russian president and other Russian representatives, spoke at the Eastern Economic Forum in Vladivostok in September 2016. At the same time, another significant feature of the future of GEP was revealed: its inclusive character.

The Greater Eurasian partnership will not be a counterposition by Russia to the Trans-Pacific partnership (* Even after US President D. Trump officially refused the TTP, it is too early to cross this project - the countries that signed the TTP Agreement continue multilateral consultations, China also joined). And the Transatlantic partnership, said in this regard on the margins of the Eastern Economic Forum, First Deputy Prime Minister Igor Shuvalov. "We carefully studied the document on the TTP and see what we can adapt for ourselves, building relationships in Eurasia ... If before this format sounded like "Europe from Lisbon to Vladivostok", now it includes both Vietnam and Singapore and a new format Interaction with Indonesia, this is Iran, Pakistan, India, China. Most likely, this work will be multi-speed, multi-level integration. The main thing is to agree not on tariffs, although for many countries this is number one issue, but to agree that the trading environment is barrier-free," the First Deputy Prime Minister said. (11)

At present, the process of integration within the framework of the EAEU and EBSR is the most important content component of the process of the formation of GEP, which, in fact, it has already begun. The first vector is the conclusion of a comprehensive agreement on trade and economic cooperation between the EAEU and China. On June 25, 2016, the Eurasian Economic Commission (EEC) and the Ministry of Commerce of the PRC signed a joint statement on the launch of the negotiation process under the agreement.

As the chairman of the Collegium of the EEC, Tigran Sargsyan, stated, the negotiation process between the parties is proceeding at an intensive pace. After agreeing common approaches to the interface of the EAEU and EBSR in August 2016, the first round of negotiations was held in Beijing. The relevant meetings are held every two months. They are organized at the level of a working group led by the ECE Minister for Trade Veronika Nikishina. (12) The next meeting was held on October 4, 201613. (13)

At the first stage, a non-preferential agreement is concluded that covers a number of spheres, not only trade facilitation and the regulatory area, with the prospect of reaching a preferential agreement. Its main sections include customs, technical, sanitary, veterinary and phytosanitary regulation, protection of intellectual property and competition and electronic commerce. The parties also plan to create "institutes of complex interaction". In "agriculture, industry, energy, transport and communications and infrastructure," common formats for projects of common interest" should appear. (14)

The Russian side proposes, in addition to negotiating an agreement on trade and economic cooperation, at which issues under the responsibility of the ECE should be discussed, to launch another track of negotiations on measures of non-tariff regulation. The powers to discuss these issues are not delegated by ECE to the governments of the EEA member states, but such negotiations could be conducted in accordance with the Protocol on Non-Tariff Regulation Measures for Third Countries (Annex 7 to the Treaty on the Eurasian Economic Union).

According to the statement of the Minister of Trade in Trade, V. Nikishina, the conclusion of a non-preferential agreement with China is possible in the short term (two years). (16) It will not replace the bilateral interaction of the member states with the PRC. At the same time, Russia is also prepared to conduct negotiations on the adoption of tariff regulation measures within the framework of the preparation of an agreement on trade and economic cooperation, which should culminate in the creation of a free trade zone (FTA), believing that this process can be completed by 2030-2035.

The second vector of interaction between the EAEU and China is the formation of the roadmap, which includes specific projects and activities to integrate the economic interests of the EAEC economies with China. The main source of the Roadmap will be medium- and long-term plans for the economic development of the states participating in the initiative.

On August 24, 2016, during the meeting of the Chairman of the Collegium of the EEC member Tigran Sargsyan and Vice-Premier of the State Council of the People's Republic of China Zhang Gaoli, the initiative of the Chinese side to establish a common database on projects was also approved. One is talking about projects that have already begun, are being implemented, and are planned for the implementation of the PRC and the SCO countries and which are involved in the process of pairing the EAEU and EBSR. Work on the creation of a data bank has already begun. (17)

The initiative on the formation of the Great Eurasian Partnership received political support from China. "The Chinese side regards this initiative as a positive and constructive idea and welcomes it," said the Director of the Department of Europe and Central Asia of the Ministry of Foreign Affairs of China, Gui Tsunyui, in August 2016.

He added that China and Russia will make joint efforts to study the issue on the promotion of this initiative. According to him, the Ministry of Foreign Affairs and economic departments of China hold close contacts for working out concrete measures to implement the agreements reached between the heads of our countries on the creation of the GEP. "I am confident that China, the ASEAN countries and other Eurasian countries will support the initiative and will promote it," the director of the department of the Chinese foreign ministry said. (18)

Equally important is the dialogue between representatives of the expert community of Russia and China on understanding and scientific substantiation of GEP. Chinese scientists and experts in general are positive about this initiative, seeing in it great opportunities for the development and arrangement of Greater Eurasia. Professor Feng Yujun writes: "In Eurasia, there are different mechanisms for regional economic cooperation and integration initiatives. All of them have their own advantages and should be complementary, and not be in conflict with each other. Any integration initiative should not be closed. As a result, Central Eurasia should become a bridge connecting the EU with the APR, and close cooperation between Europe, Central Eurasia and the APR will give a new impetus to the world economy". (19)

Moreover, Chinese scientists, in cooperation with their Russian counterparts, have begun an in-depth and orderly analysis of the interests, risks and opportunities for interaction between the PRC and Russia in this field. For example, I. Timofeev and E. Alekseenkova determine the interests of Russia in Eurasia as following:

- increasing the number of friendly or neutral forces, concentrating on resolving those problems that can not be carried out diplomatically, in a coalition with as many participants as possible;

- counteract the chaos of the Eurasian macroregion, increase the number of "hot spots", crisis zones, weak states. They serve as a breeding ground for terrorists and extremists of all stripes, undermine the regional security system;

- active role in economic and humanitarian integration projects, reducing or eliminating barriers to the movement of capital, goods, labor, connection to large-scale infrastructure projects, use of the country's transit potential;

- the desire to avoid deepening existing and creating new splits in the space of Eurasia, building mechanisms for solving common problems;

- consolidating the country's role as an equal, constructive and creative partner. (20)

Among the strengths of Russia in Eurasia are:

- advantages of geographical location. Russia has land or sea access to most of the key points of the Eurasian continent. This advantage is enhanced by the transport and infrastructure linkage of this vast space within one country;

- the scale of the Russian economy, the opportunity to act as an attractive market, and also make a significant contribution to regional economic and infrastructure projects;

- the opportunity to make a significant contribution to the security of economic projects and the region as a whole. Russia has sufficiently powerful and mobile armed forces capable of responding quickly to crisis situations, providing assistance to their partners and allies. (21)

To the shortcomings and risks of Russia in Eurasia this group of researchers includes the following:

- the complexity of economic development, a poorly diversified economy, a weakened technological base. The Russian economic system lacks flexibility, the share of the public sector is growing in it. Insufficient labor productivity is imposed on demographic problems - low population growth, population aging, high mortality;

- regional demographic imbalances. The population of Russia is extremely unevenly distributed. Its main mass is concentrated in the western part. The opportunities of Siberia and the Far East are poorly developed, including because of a lack of human resources. In terms of population reduction, these parts of Russia remain the most vulnerable;

- increased competition with the collective West, especially exacerbated by the Ukrainian crisis. Competition requires the diversion of resources for military needs, deprives them of partnership opportunities in solving common problems, creates zones of instability, which in the future will also divert considerable resources. (22)

Among the key risks for Russia in Eurasia:

- possible aggravation of regional conflicts (Afghanistan, Central Asian countries, destabilization in the Caucasus as a result of strengthening the position of Islamists, the possibility of exacerbation of frozen conflicts in the region, in particular between Armenia and Azerbaijan);

- the success of EPS, its economic impact, even in the long term, are not obvious, a similar risk should be borne in mind for the EEA;

- the temptation to politicize economic projects, especially in the event of their economic loss. Our country can be faced with a difficult choice - either costs or marginalization in regional initiatives;

- the risk that the new norms and rules of economic activity created within the framework of the EAEC will come into conflict with those that have already successfully operated before in the bilateral format or will abolish them altogether. (23)

It is of fundamental importance that Russian and Chinese initiatives in Central Eurasia are not considered mutually exclusive and closed, since their content does not presuppose the choice of one of the two institutional legal formats. Thus, according to the experts of the Valdai International Discussion Club, the activity of the Eurasian Union is aimed at developing the economies of the member countries, using such tools as creating the most favorable conditions for doing business, including investment and other activities, and creating on its territory Space of four freedoms of movement: goods, people, capital and services. The Chinese initiative contains, first of all, a large-scale investment proposal open to everyone. As a result, both formats in question harmoniously complement each other. (24)

The most important institution of international cooperation in the Eurasian space is the SCO, which has a serious potential to become the main platform for China's cooperation (EBSR) - the EEU. The SCO, with its energetic development, can become the central institution of a potential project for the creation of a Greater Eurasia community. The development and institutionalization of the SCO can create an umbrella organization for the Greater Eurasian community. (25)

Li Xin and other Chinese researchers note that the SCO's geographical area encompasses all EEU member countries that are important economic entities along EPPP within the framework of the six economic corridors set out in the document "Vision and actions aimed at promoting joint construction of the" Economic Belt of the Silk Road "and" Silk Road of the XXI century ". The SCO should play the role of the most important site in the implementation of the joining of EPS and the EAEC, especially since the goals, principles and content of the construction of EPS in the document mentioned above coincide with the interests of regional economic cooperation within the framework of the SCO. (26)

A significant argument in favor of the practical orientation and strategic nature of the BEP, which includes the linkage of the EAEUand EBSR, is the already worked out medium-term forecasts for the implementation of this process. Thus, the above-mentioned Chinese scientist distinguishes the following stages in this connection:

1. Launch in August 2016 of the negotiation process between China and the Eurasian Economic Union on the conjugation of the construction of EBSR and EAEU. At this stage, emphasis is placed on creating a soft regulatory environment. These are rules, supervision, standards, etc. The promotion of regional economic cooperation within the framework of the SCO, increasing the volume of trade, facilitation of trade and investment is continuing.

2. Around 2030 the free trade zone within the SCO is transformed into a Comprehensive Economic Partnership based on the integration of the EAEC, the SCO and the BRICS.

3. On the basis of the integration of a comprehensive economic partnership with the ASEAN countries or the newly created WRAP, a large Eurasian partnership will be established around 2040. Within the framework of this space, it is planned to create systems of complete free trade, ensure free flow of capital, create a common financial and single energy market, develop common rules for trade in goods and services, and form a common transport services market and a unified transport system. (27)

It is significant that practical work has already begun in this direction. As stated in March 2016, the first deputy head of the Ministry of Economic Development A. Likhachev, the EAEU and the SCO can begin work on the preparation of an agreement on economic continental partnership. In December 2015, at the Council of Heads of State of the SCO, representatives of Kazakhstan offered to start a serious discussion of the formation of the SCO free trade zone. The delegations of Russia, China and Kazakhstan agreed to prepare approaches to the economic continental partnership, to a comprehensive agreement within the SCO framework. The future agreement may address issues of freedom of movement of goods, freedom of movement of capital and investment, a comfortable environment for increasing the share of payments in national currencies and preferential access to markets for services. (28)

The process of forming continental Eurasian partnership from Europe to Southeast Asia is gaining momentum. As stated in March 2017, the head of the department for international cooperation of the Department for Development of Integration of ECE D. Yezhov, in 2016, for the first time in history, imports from the APEC countries in the EAEU from the countries of the APEC region exceeded imports from the EU. The agreement on a free trade zone with Vietnam has come into force. The Commission develops cooperation in the format of memorandums with the governments of Mongolia, Cambodia, Singapore. A number of states have already launched a track on the free trade zone. At the same time, the states of the region are not constrained by economic sanctions in relation to one of the Union's economies - the Russian one. (29)

Speaking at a meeting of the Supreme Eurasian Economic Council in April 2017, Vladimir Putin once again stressed that the development of the external outline of our integration association should be continued on a systematic and planned basis. (30) This work is complicated by the fact that so far there have been no precedents of interblock trade and economic partnerships. However, according to experts and economists of the ECE, it is quite realistic in the 10-year term to form BEP as a network of free trade zones, a set of trade blocs, the most likely format of which will be the so-called "spaghetti bowl".

In this regard, the most urgent task now is to determine which institutional forms would be optimal in order to give the process of formation of the community of interests and values ​​in Central Eurasia an irreversible character.

As Valdai Club experts believe, "these institutional forms should be comprehensive and inclusive, combine politics and economics, soft and hard power, be comfortable for the great, medium and small powers. We have potentially excellent institutions of international cooperation and development - "Eurasian integration", financial institutions of the "Silk Road" and the Asian Bank for Infrastructure Investments, the Shanghai Cooperation Organization, multilateral formats with the participation of ASEAN and much more. It is necessary to seek their improvement and complementarity. (31)

Also, according to Russian experts (T. Flegontova and others), the need to work out this strategy at the technical level is obvious. It is important to understand that potential states participating in the "Big Eurasia" project may face the problem of leadership, the satisfaction of the interests of all project participants, the interface of various institutional formats under the auspices of Greater Eurasia. Objectively, this project should become an exclusively Russian national strategy and unite in itself already initiated and perspective trends of cooperation. (32)

Among other things, for Russia the initiative to create a Greater Eurasian partnership is a way of transition to a strategy of advanced development by accelerating the creation of new technological industries and institutes of a new world economy. In this case, Russia and the EAEC could claim full participation in the new center of the world economic system. (33)

And last but, perhaps, no less important. Economic cooperation, megaprojects, integration of integrations are very important, but not the only dimension of GEP. There is a need for safeguards against outside interference and the imposition of models of a social or other arrangement not experienced by society itself. We need clear and well-calculated generally accepted rules of the game on the international stage, which all countries adhere to without exception. The BEP is based on strict adherence to the fundamental principles and norms of the current international law in a purely positive, systematic and mutually beneficial understanding of them. (34)

Thus, the Greater Eurasian partnership can be the beginning of a new, more rational and just world order based on multipolarity, sovereign equality, respect for all cultures, religions and civilizations, inclusive and non-discriminatory international cooperation.

 

 

1.http://kremlin.ru/events/president/news/52178;Http://kremlin.ru/events/president/news/51953

2. How, thanks to Donald Trump, China can become the new leader of globalization: Carnegie.ru // https://meduza.io/feature/2017/01/25/kak-blagodarya-donaldu-trampu-kitay-mozhet-stat-novym-liderom -globalizatsii-carnegie-en

3. Comprehensive Great Eurasian partnership: avoiding reality or returning to it // http://alleuropalux.org/?p=13969

4. Ibid.

5. New positioning of the Russian Federation in the global economy - opportunities and prospects. The Institute for Contemporary Development Fund, commissioned by the Kudrin Foundation for Civil Initiatives Support. M., September 2015. P. 108.

6. https://www.gazeta.ru/business/2017/02/25/10543481.shtml#page6

7. http://www.kremlin.ru/events/president/news/52819

8. The President's Address to the Federal Assembly, December 3, 2015 // http://www.kremlin.ru/events/president/news/50864

9. Vladimir Putin's speech at the plenary session of the St. Petersburg International Economic Forum // http://www.kremlin.ru/events/president/news/52178

10. http://www.kremlin.ru/events/president/news/53151

11. https://ria.ru/economy/20160905/1476106027.html

12. http://www.eurasiancommission.org/en/nae/news/Pages/25-08-2016-1.aspx

13. http://russiancouncil.ru/inner/?id_4=8254#top-content

14. Kommersant.ru/doc/3023535

15.http://www.eurasiancommission.org/en/act/trade/catr/nontariff/Documents/dlya%20razmesheniya/%D0%9F%D1%80%D0%B8%D0%BB%D0%BE%D0% B6% D0% B5% D0% BD% D0% B8% D0% B5% 207.pdf

16. http://www.stanradar.com/news/full/20200-dogovor-obedinenija-eaes-i-shelkovogo-puti-mogut-podpisat-za-2-goda.html

17. http://www.eurasiancommission.org/en/nae/news/Pages/25-08-2016-1.aspx

18. https://ria.ru/east/20160803/1473546327.html

19. Geoeconomics of Eurasia. Astana Club. November 2015. P. 25.

20. Ibid. Pp. 51-52.

21. Ibid. P. 53.

22. Ibid. Pp. 53-54.

23. Ibid. Pp. 54-55.

24. Bordachev TV, Kazakova AV, Skriba A.S. Institutes for Peace in Eurasia // Bulletin of International Organizations. 2016. №2. C. 25.

25. Li Xin. Chinese view on the creation of the Eurasian economic space. Report of the International Discussion Club "Valdai". M., November 2016. S. 9.

26. Ibid. C. 10.

27. Ibid. Pp. 14-15.

28. http://www.interfax.ru/business/496964

29. http://eurasiancenter.ru/expert/20170315/1004442721.html

30. Meeting of the Supreme Eurasian Economic Council in an expanded format, April 14, 2017 // http://www.kremlin.ru/events/president/transcripts/54293

31. To Great Ocean-4: turn to the East. Preliminary results and new tasks. Report of the International Discussion Club "Valdai". M., May 2016. P. 36.

32. Manning Robert A., Chheny Zhimin, Son Goyu, Flegontova Tatiana. The economic order in the Asia-Pacific region and the interests of Russia. Report of the International Discussion Club "Valdai". M., March 2017. P. 18.

33. https://www.gazeta.ru/business/2017/02/25/10543481.shtml#page6

34. The Comprehensive Great Eurasian Partnership ...

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Vladimir Petrovsky