By Alexander Nagiba exclusively for Vestnik Kavkaza
Officials of the member-states of the Eurasian Development Bank (EDB), international organizations and integrational structures, scientists of the CIS and experts gathered at the 9th Eurasian Economic Integration Conference, organized by the EDB at the end of last week. The conference was organized to find directions for development of Eurasian integration on the eve of the Eurasian Economic Union Treaty.
Ruslan Grinberg, the director of the RAS Institute of Economics, noted the presence of economic apathy in the forming Eurasian Union. The Russian economy is facing slow growth rates and a transition towards stagnation, possibly followed by recession. The geopolitical situation further worsened developments. Any integration attempts in post-Soviet space were taken by the West as attempts at reviving Russian imperialism, assumes Grinberg. The exchange of sanctions and the information war have aggravated economic difficulties. The expert noted that the Eurasian Union was a delicate child who could have a bright future.
Grinberg said that countries with fuel resources were doing better than others. "We need to understand that international labour distribution within the framework of our Eurasian Union presupposes a scrupulous assessment of the potential there is and the formation of a collective industrial policy based on carefully-picked priorities of the processing industry. I think we do not fully understand what is happening in countries, what there is left and what needs saving. We understand that there are three criteria for development of such a policy: first, we can bring our internal trade up to world standards; secondly, support for hopeless industries; thirdly, the industries we need for our defence potential, regardless of their efficiency. We could have made use of the potential of active cooperative collaboration within the post-Soviet space. I am adamant that we could have involved Ukraine in the process. Kiev has a clear understanding that mutually-beneficial economic ties have no alternative. Thirdly, Russia has always been very avaricious and ungenerous in the integration process. I think it is time we reconsidered this," assures Grinberg.
Andrey Klepach, an ex-deputy minister for economic development, deputy head of the VEB, pointed out that Kazakhstan, Belarus and Russia have faced a great drop in their economic growth rates. A 40-50% drop in Russia is structural, the figures total 50-60% in Belarus, 60-70% in Kazakhstan, according to the expert. In his opinion, the structural factors are closely associated with the dependence of Kazakhstan and Russia on extraction and exports of hydrocarbons, stagnation of oil extraction, which was also partly caused by the launch of Kashagan extraction. Klepach admitted that the dependence of the Russian oil industry on the U.S. was extremely high, about 80% of Russian oil wells were served by U.S. companies, a good lesson for Kazakhstan, where all oil extraction is under U.S. control.
"Referring to Russia, there are indeed questions about the extent and ways of stimulating the economic growth rate, economic growth in Belarus and Kazakhstan depends on it to a certain extent. There are certainly disputes. Our government has not used active measures to stimulate economic growth by using budgetary, financial or monetary instruments, but I think that we will be back to that issue. The Russian economy is below its potential growth, evaluations of the potential growth are different, some say it is 2% and above, but it is much lower, in fact. So there are opportunities without escalating inflation," said Klepach.
He reminded about realization of joint projects such as the construction of the Moscow-Kazan-Yekaterinburg high-speed highway, the high-speed railway from China to Russia through Kazakhstan and into Europe. Klepach added that Eurasian integration would never have been realized without taking Eurasian values into account. The experience of other countries, in his opinion, could boost economic development.
