Russia and the Eurasian Economic Union: the view from Moscow

Russia and the Eurasian Economic Union: the view from Moscow

Commentary

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This article is part of ECFR's Wider Europe Forum


On 1 January 2015, for the first time in the history of Eurasia, several former members of the USSR were united not through conquest, but on the basis of pragmatic cooperation and the creation of common institutions to regulate economic activity. Moreover, the Eurasian Economic Union (EEU) was founded on the basis of equality. Each member state has exactly the same representation within the union. This is a truly historic event that is completely unprecedented in the post-Soviet space.

Political goals can be achieved using economic instruments, and Eurasian integration is no exception.

It should be remembered that the most important element of any integration process between states is politics. European integration, for example, was conceived as a way of preventing another war between France and Germany, and also as a way for European countries, having lost their former colonies, to retain some global influence. These were both purely political goals. But political goals can be achieved using economic instruments, and Eurasian integration is no exception.

Two different groups have alleged that the EEU is a Russian imperial project. The first group is made up of Western enemies of Eurasian integration and their representatives in Russia and other EEU countries. In some quarters in the West, there is open hostility towards the EEU – or, to be more precise, hostility not only towards the EEU, but towards any integration project that represents an alternative to the EU. The EEU has enemies in the east as well, but not because of any allegiance to a competing project – rather, because of a lack of understanding as to what the EEU is all about.

The second group that accuses the EEU of being a reincarnation of the USSR is made up of other EEU member states, those involved in negotiation processes within the EEU. It is entirely normal that countries that are smaller than Russia in terms of economy, territory, and population should aggressively defend their sovereignty. Any state involved in an integration project tries to extract the maximum benefit for itself, while giving away the minimum in sovereignty. The same thing happens in the EU.

In some quarters in the West, there is open hostility towards the EEU – or towards any integration project that represents an alternative to the EU.

However, Russia has done something that very few people expected: it has already begun to share its sovereign rights with its partners, on a scale that has never been seen before. The Eurasian Economic Commission has two representatives from each member state, and Moscow has not reserved the most influential positions for itself. There are rumours that the Commissioner for External Trade in the next Commission may not be Russian. This really is a limitation on Russian sovereignty. Transferring part of Russia’s sovereignty to the supranational level is a sign of trust in its partners.

It would be disingenuous to say that the EEU will not be economically beneficial to Russia. Russia, as the most powerful member state, will be the main pole of attraction, drawing in the most resources (primarily human and financial). Germany plays a similar role in the EU. Kazakhstan is currently the country that benefits most from Eurasian integration, but this is not a problem. Russia will still gain real advantages from creating a trade bloc around itself.

It should be remembered that the EEU is being built in the context of an external environment of unprecedented instability. The EU is very negatively disposed towards any integration projects in Eurasia that are not centred on Brussels and do not come under the EU’s control. After the end of the Cold War, a Eurocentric model of Eurasian integration was conceived: the EU was to be the centre, with the place of all the rest defined by the quality of their relations with Brussels. The emergence of Eurasian economic integration and its potential success provides an alternative to this vision. And for a range of cultural and political reasons, our partners in the West cannot accept this alternative. They see the success of the EEU as a defeat for them. That is why EU representatives refuse to engage in a direct dialogue with the Eurasian Economic Commission. In the end, it will have to be explained to our European friends that, since economic regulations are already now largely dealt with at the union level with the Eurasian Economic Commission in charge, individual EEU member states have nothing to talk about with Europe.

Russia has already begun to share its sovereign rights with its partners, on a scale that has never been seen before.

As for China, Beijing is afraid that the creation of the EEU will cut China off from Eurasia and leave it unable to develop economic ties with the region, particularly with Kazakhstan. For this reason, the Chinese were against the EEU in the initial stages of the process, although, of course, not as openly as the Europeans. Moscow is conducting extensive outreach to Beijing right now in order to assuage these fears.

In any case, the EEU and the China-led Silk Road Economic Belt are not competitors because they are about completely different things. Eurasian integration is necessary so that member states can jointly regulate their economic activity. The Silk Road Economic Belt is a transport and logistics project aimed at developing the region on the basis of Chinese investment. These two projects do not propose alternative models of development or management. China as a matter of principle does not want to share sovereignty or to create joint economic institutions with anyone. So, the EEU and the Silk Road Economic Belt are not competing but complementary projects.

Timofei Bordachev is director of research programmes at the Council for Foreign and Defense Policy and director of the Center for Comprehensive European and International Studies at the National Research University – Higher School of Economics.

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