On October 18th in St. Petersburg the heads of the CIS countries’ governments signed the agreement on the free trade zone, which had been developing for several years. A few days later the video link was organized in Moscow. Experts expressed their views on what this agreement means for the CIS countries, how it will work and prospects for deeper integration in former Soviet space.
Gagik Kocharyan, Head of the Department of Trade and Regulation of Markets at the Ministry of the Economy of Armenia
I welcome the creation of the Free Trade Zone. We regard it as a regionalization tendency. Globalization is very often discussed, while the counterbalance is always forgotten – economic regionalization. Why did it take so long for the free trade zone to be created? I think that there are reasons. First of all, during this period five post-Soviet countries became members of the WTO and it facilitated the implementation of international standards in the free trade zone. We should first of all address ourselves to the international experience. The fact that the North American zone of free trade is already twenty years old and that its members are not able to reach the next level of economic integration of the Customs Union indicates serious problems and threats faced by countries. We should be realistic in assessing our capabilities.
The regional situation in post-Soviet space is difficult. We should bear in mind that, along with the CIS, there are several other regional organizations, such as the Black Sea Economic Cooperation and GUAM – and no one talks about it. All the countries mentioned in the European part of post-Soviet space are gravitating towards the European Union. The Eastern Partnership, which has recently been initiated by Poland and in which six ex-Soviet countries are participating, also serves the means of joining the European Union. We should not forget that our common goal requires a single currency.
How can we attain a single currency? I recall some articles published by the Kazakh president, Mr. Nazarbayev, in "Nezavisimaya Gazeta" and "Izvestiya" in 2009, in which he talked about creating an international currency as a counterbalance to the dollar, which poses great difficulties to world economies at the present moment, as they are all dependent on the dollar as an international currency, which is not controlled by international cooperative forces. I would like to say that all the countries which have already signed this document understand that they will participate in team work. This team work creates real possibilities to realize not only national advantages but also cooperative advantages.
What will Armenia gain with this? In my view, there are positive and negative issues in this regard. First of all, the market for Armenian businessmen will expand and the small-scale market which has been binding them in the last twenty years will expand. More propitious conditions for healthy competition will be created and monopolies will be dislodged, which should also be regarded as a positive effect of the free trade zone. We should also note that budget subsidies will decrease and goods which are not included in the free trade zone, it was spoken today about their withholding, which is so far justified. Overall, I think it is a very timely decision and we should count all the pluses and minuses in order to learn our lessons and not tolerate big mistakes. In my opinion, in the near future we will be able to reach another level of economic integration.
Pavel Nefidov, the director-general of the Financial-Banking Council of the CIS
I believe it is a very distant prospect. We have to pass through so many steps of integration in order to reach the situation of a single currency, because it is not only influenced by economic, but also by political and other aspects. I believe it is much more practical to talk about the effective work with the national currencies and I have talked about it. There is a lot of room for cooperation in this field. The question of the ruble becoming this international currency was raised, but the events of 2008 have significantly distanced this possibility. Not to mention the fact that certain countries have troubles with the ruble, which would not like to see any national currency implemented as a single currency in the free trade zone.
VK
