Eurasian integration at the breaking point

Victoria Panfilova, columnist of Nezavisimaya Gazeta, specially for Vestnik Kavkaza
Eurasian integration at the breaking point

The heads of state of the Eurasian Economic Union (EAEU) did not sign the Strategic Directions for Eurasian Economic Integration Development until 2025. The document was sent to be fixed. This decision was made following a meeting of the Supreme Eurasian Economic Council, which was held via videoconference. The strategy will be finalized taking into account the proposals of the Belarusian and Kazakh sides.

Belarus and Armenia are not satisfied with Russia's high gas tariffs. According to Minsk and Yerevan, its value is discriminatory and collapses integration, while according to Moscow, this is a pricing market mechanism. Russia sells natural gas to Europe at $65-68, while to Belarus - at $127. President of Belarus Alexander Lukashenko noted that the document includes no urgent proposals to be implemented. "This is a strategy, so there’s no rush, except for the natural gas issue. And even if we agree on such a formulation on natural gas, this is not a concrete decision. Concrete negotiations will follow," the Belarusian leader said. He proposed to return to the issue during the next meeting of the Supreme Eurasian Economic Council, which is planned to be held in October - November in Minsk.

Yerevan has similar claims. Armenian Prime Minister Nikol Pashinyan previously discussed the price of gas with Vladimir Putin twice, but in the end it was still raised: from $150 to $165 per 1 000 cubic meters in January 1, 2019. This year the price is $150 per thousand cubic meters. Nevertheless, the cost of Russian gas supplied to Armenia is 2.8 times more expensive than in Europe. In early April, Gazprom Armenia applied to the Public Services Regulatory Commission with a request to revise natural gas tariffs. It was proposed to increase the average tariff by 11%.

According to Russian President Vladimir Putin, they can have a single tariff only within a single market with a single budget and taxation system: " The EAEU has yet to reach this advanced level of integration. For now, gas prices must be market-based. This is a common practice around the world."

“Eurasian integration as a bureaucratic process has stalled. But the bureaucratic process and integration itself are not identical concepts. Integration from above rests against the interests of elites, and integration from below has not even begun. We can say that almost everything here is a tabula rasa, which means a lot of space and freedom for creativity," Belarusian political scientist Alexei Dzermant believes. In his opinion, the slowdown in integration into the EAEU will strengthen China's influence, with which each EAEU country will seek to come to an agreement itself.

The meeting of the EAEU Council showed the existence of contradictions between the production and energy sources, and in general, the limit of integration has been reached, according to the expert at the Russian Council on Foreign Affairs, associate professor of the Russian State Humanitarian University Alexander Gushchin. He noted that they will have to get over themselves in order to overcome these contradictions. Otherwise, it will be necessary to recognize that sovereignty, potential differences, weak economies of a number of countries are an insurmountable anchor of further integration. Gushchin believes that both real industrial cooperation and pooling of capital, even with the most industrially strongest Belarus, as well as the real strengthening of supranational structures, or creation of a real regional eager market are out of question. Either national interests (including national fuel and energy complexes) interfere, or political contradictions or elites are not ready to give up particles of sovereignty, although in reality, the real return to sovereignty is still far away. Russia and Kazakhstan, on the one hand, and Belarus and Armenia, on the other, form different approaches, which impedes integration. This suggests that the transfer of the integration dominant from the Union State to the EAEU will not solve the issue quickly, since unresolved problems, while maintaining the old approaches of the parties, will simply be transferred to a multilateral format. The development of the international subjectivity of the union and its attractiveness are also inhibited.

President of Kazakhstan Kassym-Zhomart Tokayev also criticized the Strategy. According to him, some of the document’s proposals constitute an "inappropriate overrunning". He spoke out against the expansion of the Eurasian Economic Commission's powers, noting that giving it additional competencies in health, education and science "significantly changes its economic focus." The ideas of the Commission’s participation in bilateral negotiations of member states with third countries on trade and economic issues were also negatively evaluated. "Trade in services and investments are national competence," Tokayev recalled.

According to Kazakh political scientist Askar Nursh, in recent years, the Eurasian Economic Commission's apparatus has focused on promoting proposals, firstly, to expand its supranational powers, and secondly, to include a "humanitarian basket" in the EAEU legal package through the expansion of integration into health, education and science areas. This is not included in the constituent agreement on the creation of the EAEU. These initiatives, promoted by the Russian side, have not yet been supported by Kazakhstan, which was confirmed by President Tokayev in his speech during the Supreme Eurasian Economic Council's online meeting: "This will lead to the rejection of the strategy by national public opinion since the strategy will limit the sovereign rights of governments and parliament."

Director of the Group of Risk Assessment Dosym Satpayev told Vestnik Kavkaza that Tokaev’s critical attacks on the EAEU have several reasons. First, they reflect the general growth of negative attitudes in Kazakhstan towards this project, where "Russia's geopolitical ambitions initially drove all the EAEU members into the role of hostages of the Kremlin’s foreign policy." Therefore, Tokaev voiced what others have already warned about in Kazakhstan. Criticism of the EAEU was also aimed at an internal audience in Kazakhstan, given the fact that Tokayev is trying to gain political points as a defender of Kazakhstan’s national interests. In addition, unlike Nursultan Nazarbayev, who considered the EAEU as his personal foreign policy project, designed to assign him the role of the main integrator of the post-Soviet space, Tokaev does not have a "great integrator" complex, and therefore an emotional connection with the EAEU, which allows for a more realistic look to all the problems of this structure.

Second, it was not Tokayev who initiated critical attacks on the EAEU. Alexander Lukashenko was engaged in this long before him. From the very beginning the EAEU was like a communal apartment with constant conflicts. And if Minsk had previously accused Moscow of violating the treaty sections regarding the functioning of the EAEU, recently the same criticism is voiced against Kazakhstan by Kyrgyzstan. It is not surprising that Uzbekistan, having seen enough of these squabbles, decided to become only an observer in the EAEU, despite all Russia's attempts to "lure" Tashkent there as a full member.