Eurasian Economic Union will not improve people's lives instantaneously

"Vestnik Kavkaza"

The State Duma has promised to quickly ratify the Treaty on the Eurasian Economic Union, submitted 10 days ago by the president. Specific dates of ratification might be determined already at the first meeting of the committee on September 18. The head of the Duma Committee on CIS Affairs, Leonid Slutsky said that the deputies "will depend on ratification in other capitals such as Astana and Minsk. We have no objective to ratify the treaty the same day, but ratifications like that should take place, if not at the same time, then at least close in time." Slutsky did not talk about the deadline for Armenia's accession to the Union.

At a meeting of the Supreme Eurasian Economic Council in Astana on May 29, the president of Armenia said that Yerevan intended to sign the treaty on joining the EAEU by June 15. However, the process has been delayed and the final version of the treaty was sent to Armenia only on September 3.

Meanwhile, there is still no consensus in Yerevan on joining the Customs Union. 

According to a poll conducted by Gallup International Association, only 21% of those polled believe that Armenia's accession to the Customs Union would be desirable. 36% believe that it would probably be a positive experience, 15% - probably a negative one and 12% believe that it will definitely be a negative one. 15% of respondents could not give a clear answer, Armenia News reports. Currently at least 60% of Armenians want to join the Customs Union, while in April 2013 about 70% wanted to do so. 

Aram Navasardyan, the head of the Gallup International Association, believes that Armenia is now less interested in joining the Customs Union due to the prolongation of the process and statements made by the president of Kazakhstan, Nursultan Nazarbayev, that Armenia should join the Customs Union within the borders recognised by the UN, meaning without Karabakh. 

By the way, responding to the question of whether Armenia should join the Customs Union without Nagorno-Karabakh, only 6% of respondents answered "definitely yes," 17% answered "probably yes," 21% - "probably no" and 43% - "definitely no."

Answering the question of how joining the Customs Union would affect the economy of Armenia, 40% of respondents said that the economy would improve, 19% were undecided, 15% of respondents expected an increase in prices and 12% feared a decline of Armenia's economy.

Meanwhile, the head of the department of Economics of the CIS Countries Institute, Aza Mihranyan, believes that "the Customs Union and the Common Economic Space (CES) remain the basis for economic integration. The agreement which will come into force in January 2015 provides a foundation for an actual economic integration, built on achievements developed during the Customs Union integration."

Mihranyan noted that the mutual trade turnover has decreased: "It is absolutely normal, because the format has exhausted itself. We cannot develop further, especially given that there is a decline in economic growth almost all the countries of the Customs Union and the Common Economic Space, as well as  the future EAEU. Accordingly, we have to talk about the quality of interactions. Thus, recently it has been decided to establish a corporation managing the railways of Kazakhstan, Russia and Belarus. It is a real step that aims at deepening economic integration. The creation of a unified transportation system is very important, not only for the transport of goods and services, but for the transport of all production aspects, including labor resources, capital mobility, etc. The next step is the formation of common trade logistics centers. I am not talking only about the market of goods, but also the commodity market, exchange of houses, component markets, the raw materials market which complement and enrich each other. Certainly, we need to create a common market of technologies. All these provisions are manifested in the treaty's protocols which will come into force."

Mihranyan believes that "we cannot say that as soon as the population enters the common economic space their lives will improve instantaneously, because integration into a shared space is a gradual process. At the moment we still have different systems of internal taxation, and hence people will have different standards of living, but nevertheless the adaptation stage, the stage of overcoming the price gap between Kazakhstan, Russia and Belarus, has become more smooth recently. This means that integration within the EAEU will not bring any major negative effects such as accelerated inflation and so on."