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Reintegration processes in the CIS
Yerkir.am
July 07, 2006
The CIS countries' attempts to transform and adjust this political
union to the realities of the globalized world create new features
in the behavior of the CIS member states. The modification of the
geopolitical orientation of the larger members of the CIS serve as new
signals for such transformations. On the other hand, the traditional
economic and cultural ties and the opportunities for their restoration
serve as a kind of counterbalance for the disintegration processes.
Background of the issue
The main issue on the agenda of the recent summit of Eurasian Economic
Cooperation (known as EurozES) leaders was the issue of establishment
of a customs union in the framework of this organizations.
Against the background of Russia's rather pragmatic policies towards
the CIS states, political analysts were increasingly optimistic about
this initiative. The leaders of the six members of EurozES announced
that it is possible that the EurozES customs union will be created
by the end of this year, something which was not possible to do in
the past fifteen years.
EurozES, an entity formed in the framework of CIS in 2000, was aimed to
regulate and ensure smooth operation of the member states' economic
relations, trade regimes, provision of resources, flow of human
capital, technological and infrastructure sectors. Establishment of
more or less liberal and efficient customs and tax regulation regimes
was an axis for the initiative.
Armenia's expectation from EurozES
Armenia applied to be an observer to this organization. The observer's
status allows the country to participate in the open sessions,
make statements and receive documents on the decisions taken by the
organization.
The priorities EurozES has set for itself are to some extent related to
Armenia's vital interests, especially in the sectors of transport and
freight transportation, energy sector, regulation of labor migration
and cooperation in the sector of agricultural and industry.
On the other hand, as a member of the World Trade Organization and
a country with multi-faceted economic, trade and military-technical
relations with CIS countries Armenia could not stay indifferent towards
the transformation and reintegration processes underway in the CIS.
The leaders of the CIS states voice the opinion that the new customs
union which is in the process of being established aims at developing a
common position towards membership in the World Trade Organization. In
this context, the proposal made at the Minsk Summit to set a unified
customs tax in the framework of EurozES is of special interest.
In the context of the recent developments in the CIS Russia's decision
to increase the prices for gas should be considered quite natural. The
promise-threat to sell 1000 cubic meter of natural gas for 180 dollars
starting next year can easily be understood in this context.
Depending on the supply of the Russian gas, CIS partners including
Armenia will have to diversify their energy resources. In the case
of Armenia, rapid construction of Iran-Armenia gas pipeline emerges
as increasingly important.
Of course, deepening relations with EurozES member states and
membership in their customs union might be in Armenia's interests if
the political and regional problems on the way to such membership are
settled. However, to wait that large investments would flow to Armenia
from the EurozES region in near future would be an overly exaggerated
expectation, especially in what concerns investments from Russia.
Russia itself is in dire need of investments. Russia needs millions
and millions of working people. According to different estimates,
5-8 million people from the CIS are currently working in Russia. This
number is far from being sufficient. 65 million people are currently
working in the Russian economy while the expectation is that 8-10
million new jobs will be created in the near future. This is why
the Russian authorities are planning to eliminate all obstacles for
labor migration.
This means Russia itself needs large investments and is using all
methods to attract them. Experts estimates Russia needs investments
of 2-3 trillion dollars in the coming 10 years and will do everything
to encourage such investments. Armenia in its turn can and is making
considerable investments into Russian economy with its qualifies
labor force. This investment is larger than any investment Armenia
can expect to get from Russia.
As to Russian investments made or expected to be made in Armenia,
Russia is solving more political than economic problems through such
investments. The fact that the Russian authorities did not want to
delay the payoff of Armenia' s debt of 100 million dollars, is an
indirect evidence of this. Meanwhile, successful Russian investments
are more of an exception than a rule.
By Mher OHANIAN
Yerkir.am
July 07, 2006
The CIS countries' attempts to transform and adjust this political
union to the realities of the globalized world create new features
in the behavior of the CIS member states. The modification of the
geopolitical orientation of the larger members of the CIS serve as new
signals for such transformations. On the other hand, the traditional
economic and cultural ties and the opportunities for their restoration
serve as a kind of counterbalance for the disintegration processes.
Background of the issue
The main issue on the agenda of the recent summit of Eurasian Economic
Cooperation (known as EurozES) leaders was the issue of establishment
of a customs union in the framework of this organizations.
Against the background of Russia's rather pragmatic policies towards
the CIS states, political analysts were increasingly optimistic about
this initiative. The leaders of the six members of EurozES announced
that it is possible that the EurozES customs union will be created
by the end of this year, something which was not possible to do in
the past fifteen years.
EurozES, an entity formed in the framework of CIS in 2000, was aimed to
regulate and ensure smooth operation of the member states' economic
relations, trade regimes, provision of resources, flow of human
capital, technological and infrastructure sectors. Establishment of
more or less liberal and efficient customs and tax regulation regimes
was an axis for the initiative.
Armenia's expectation from EurozES
Armenia applied to be an observer to this organization. The observer's
status allows the country to participate in the open sessions,
make statements and receive documents on the decisions taken by the
organization.
The priorities EurozES has set for itself are to some extent related to
Armenia's vital interests, especially in the sectors of transport and
freight transportation, energy sector, regulation of labor migration
and cooperation in the sector of agricultural and industry.
On the other hand, as a member of the World Trade Organization and
a country with multi-faceted economic, trade and military-technical
relations with CIS countries Armenia could not stay indifferent towards
the transformation and reintegration processes underway in the CIS.
The leaders of the CIS states voice the opinion that the new customs
union which is in the process of being established aims at developing a
common position towards membership in the World Trade Organization. In
this context, the proposal made at the Minsk Summit to set a unified
customs tax in the framework of EurozES is of special interest.
In the context of the recent developments in the CIS Russia's decision
to increase the prices for gas should be considered quite natural. The
promise-threat to sell 1000 cubic meter of natural gas for 180 dollars
starting next year can easily be understood in this context.
Depending on the supply of the Russian gas, CIS partners including
Armenia will have to diversify their energy resources. In the case
of Armenia, rapid construction of Iran-Armenia gas pipeline emerges
as increasingly important.
Of course, deepening relations with EurozES member states and
membership in their customs union might be in Armenia's interests if
the political and regional problems on the way to such membership are
settled. However, to wait that large investments would flow to Armenia
from the EurozES region in near future would be an overly exaggerated
expectation, especially in what concerns investments from Russia.
Russia itself is in dire need of investments. Russia needs millions
and millions of working people. According to different estimates,
5-8 million people from the CIS are currently working in Russia. This
number is far from being sufficient. 65 million people are currently
working in the Russian economy while the expectation is that 8-10
million new jobs will be created in the near future. This is why
the Russian authorities are planning to eliminate all obstacles for
labor migration.
This means Russia itself needs large investments and is using all
methods to attract them. Experts estimates Russia needs investments
of 2-3 trillion dollars in the coming 10 years and will do everything
to encourage such investments. Armenia in its turn can and is making
considerable investments into Russian economy with its qualifies
labor force. This investment is larger than any investment Armenia
can expect to get from Russia.
As to Russian investments made or expected to be made in Armenia,
Russia is solving more political than economic problems through such
investments. The fact that the Russian authorities did not want to
delay the payoff of Armenia' s debt of 100 million dollars, is an
indirect evidence of this. Meanwhile, successful Russian investments
are more of an exception than a rule.
By Mher OHANIAN