Russian President Vladimir Putin gave the Russian government the first introductory notes concerning a new stage in the development of the Eurasian Economic Union (EAEU), created, as it is believed, in opposition to the European Union. At a meeting on January 20, the head of state discussed with officials international agreements that could change the Russian economy. Political scientists and economists, in a conversation with URA.RU, explained how the changes will affect the well-being of Russians and what could prevent this.
The EAEU, which includes Russia, Kazakhstan, Belarus, Armenia and Kyrgyzstan, was created in 2014 to develop the free movement of goods, services, capital and labor. During the meeting, Putin said that over the six years of the union’s existence, the participating countries have managed to increase mutual trade by 35 percent – to $ 61.6 billion. “This positive dynamic has been achieved largely thanks to joint efforts aimed at removing barriers to the movement of goods, services, capital and labor between the countries of the union,” Putin said.
One of the examples of successful cooperation between the countries, the President named the creation of a single market for drugs and medical devices, which began to operate. from January 1. In addition, the single service market continues to expand. Now it includes 53 sectors, and in 2021 it will cover five more directions. “I would also like to note that the member states of the Union have approved the concept of forming a common financial market for the EAEU. Preparations are underway to create a common electricity market, ”Putin added.
During his speech, the head of state recalled that in December, the EAEU member states approved a strategy for economic integration until 2025, which completes the formation of a common product market and a single digital space. In this regard, the head of state has new introductory notes for the Cabinet: « Let’s start discussing the most relevant aspects of integration construction in the Eurasian space, including in terms of their effective coordination with the plans and work of the Russian government to achieve national development goals. »
RISS senior expert Ivan Bazhenov considers the linking of integration construction to national goals to be a significant event. The economist explained that the success of processes within the EAEU will directly affect the implementation of state tasks. “For example, in 2020, the situation with the covid directly affected the access of labor migrants, and this immediately affected the construction market. That is, the pace of construction will depend on how easy it will be for labor migrants to obtain work permits in Russia. And the goal of improving housing conditions already depends on them, ”Bazhenov said.
At the same time, integration within the EAEU will affect the well-being of Russians. For example, an increase in the number of new apartments will help reduce housing prices, Bazhenov added. According to him, integration processes can also strengthen the ruble, since settlements in national currencies will develop and a common market for financial instruments will be built. The changes will also affect the prices of goods. “In recent years, our weighted average customs tariffs tended to decrease, but remained quite high – in some cases up to two times higher in comparison with tariffs in the EU. The end of the transitional integration period will help reduce trade tariffs. And the lower the duty, the more the consumer wins, ”the economist explained.
“If we take the service sector, then integration opens up new markets for entrepreneurs, which can affect the development of local production. And these are new jobs and an increase in salaries, ”confirms Vladimir Evseev, head of the department for Eurasian integration and development of the SCO at the Institute of CIS Countries.
It is significant that the meeting was held on the day of the inauguration of the new US President Joe Biden, who is critical of Russia. In addition, according to the Kremlin, after the meeting, Putin phoned President of Belarus Alexander Lukashenko. “For Russia, this project is not only economic, but also political. It is important for Moscow to have an orbit of countries with which close economic cooperation has been built. This is a security issue – all the countries from this bloc are members of the CSTO, ”Belarusian political scientist, EAEU expert Dmitry Bolkunets told URA.RU.
At the same time, the Russian authorities need to prepare for new challenges, the expert said. The interlocutor of the agency refers to such possible political crises in the member states of the union. “In the course of adopting the strategy, such challenges have already arisen: the revolution in Kyrgyzstan, the conflict in Karabakh, protests in Belarus. Political instability strains investors. Hardly anyone will now dare to invest even a ruble in Belarus, ”Bolkunets believes.
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