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Published on Central Asia-Caucasus Institute Analyst (http://old.cacianalyst.org)

DOUBTS REMAIN AS RUSSIA AND PARTNERS HEAD FOR EURASIAN ECONOMIC UNION

By Georgiy Voloshin (03/21/2012 issue of the CACI Analyst)

On March 19, Russian President Dmitry Medvedev met with the leaders of the Eurasian Economic Community (EurAsEc) to discuss the prospects of regional integration. In his statement to the press, he reconfirmed the intention of EurAsEc member states to work out a comprehensive treaty establishing the Eurasian Economic Union by January 1, 2015. In this regard, the participating heads of state signed a preliminary agreement which launched formal consultations with a view to modifying the current legal basis of the EurAsEc by expanding its scope of action and providing it with more substantial executive powers. Another agreement, also signed during the meeting, formally empowers the Eurasian Economic Commission to implement the functions of a supreme supervisory body headed by Russia’s former minister for industry and trade.

While it becomes clear that Russia’s plans to carry on its integrative agenda in the former Soviet space will only be strengthened by Putin’s imminent accession to the presidency, the orientations of Moscow’s partners in Central Asia, Europe, and the Caucasus are far from secure. During his meeting with Putin, President Nazarbayev warmly welcomed his recent reelection, expressing a hope that fruitful Kazakh-Russian cooperation will be continued. He even suggested rewriting the 1992 Treaty on friendship, cooperation, and mutual aid between Kazakhstan and the Russian Federation, because bilateral relations have evolved since then in a more positive sense. In his turn, Putin thanked Nazarbayev for his constant effort to reinforce regional cooperation, be it in the framework of the Commonwealth of Independent States, or in the EurAsEc, or more recently in the Customs Union. According to most observers, Kazakhstan has the strongest pro-Russian course in its post-Soviet foreign policy, which is not always the case in other ex-USSR republics.

Kyrgyzstan is one of those countries, which are currently divided between the promise of a better relationship with Moscow and the need to retain sovereignty on fundamental economic issues. According to Sapar Issakov, the head of a foreign policy section in the presidential administration of Almazbek Atambayev, Bishkek is now conducting formal talks about the country’s accession to the Customs Union. This process will most likely take from two to three months. At the same time, the Kyrgyz president has recently been highly critical of Moscow’s ambitions in Central Asia.

On his latest visit to Russia in February 2012, Atambayev threatened to close down the Russian airbase in Kant, saying that “the present-day situation, in which the Russian airbase is not fulfilling its obligations and is not even paying the rent, is not acceptable.” He further suggested that two Kyrgyz companies operating in the oil and gas sector and coveted by Russian entrepreneurs might not be sold to Gazprom, contrary of what had previously been promised. Some experts believe that this policy of maneuvering is mostly aimed at obtaining larger gains from the relationship with Russia. One of the sticking points between Moscow and Bishkek is the disbursement of more than US$ 100 million promised by the Kremlin to the new Kyrgyz government, in exchange for support of Russia-piloted investment and military projects. Yet, no aid has been granted to Kyrgyzstan following Atambayev’s victory in the presidential election, which casts serious doubts on the sincerity of Moscow’s promises and forces Kyrgyz authorities to behave more aggressively. At this stage, it cannot be totally excluded that Bishkek might use its hypothetical membership in the Customs Union as a bargaining tool to extract larger concessions from Russian policymakers.

Another country, which is rather wary of increased Russian influence, is Ukraine. During his talks with Russian counterparts, Viktor Yanukovych was ambivalent about his country’s readiness to join the EurAsEc. “This is an integration process, from which Ukraine has been absent for years. As we are now lagging behind, it is difficult for us to understand how we can get involved in this process,” the Ukrainian leader said, adding that “it is unclear to us how Ukraine’s membership in the EurAsEc matches our interests.” Ukraine previously made public its intention to join both the Eurasian Economic Community and the Customs Union, further expanding its participation in the Common Economic Area in force since January 1, 2012, as well as in the Eurasian Economic Union, still a subject of discussions. At the same time, the country’s difficult relations with Russia over the gas issue have poisoned the process of negotiations, especially after Ukrainian authorities declared the 2009 gas contracts signed by Putin and Tymoshenko “a breach of national interests.” Finally, Russia did not manage to convince Turkmenistan, Uzbekistan, and Azerbaijan of the benefits of a free-trade area in the CIS. These three countries declined to sign last year’s agreement, demanding extra time for more detailed studies, which demonstrated their reluctance to engage in economic projects brokered by Moscow. 


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