Eurasian Powers Look to Organize New Economic System

The Eurasian Economic Union (EAEU) held its Economic Forum on May 26 in the Kyrgyz capital of Bishkek under the banner of “Eurasian Economic Integration in the era of Global Changes”. It was followed the next day by a meeting of the heads of state and government of the five member union (Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia plus Uzbekistan with observer status). There was much debate at the Forum on the perspectives for building and coordinating an economic system independent of the western paradigm. Given the dominant role of the Russian economy in the trade relations of the region, the western sanctions imposed on Russia have greatly accelerated the push for Eurasian integration, although it began many years ago.

A priority for 2002-23, according to the EAEU’s Integration and Macroeconomics Minister Sergey Glazyev, is to create “favorable conditions for increasing investment in the real sector of the economy”, and developing “the scientific, technological and industrial potential” of the group.

The member countries are also eager to expand their partnerships. Negotiations on free trade agreements are ongoing with Egypt, India, Indonesia, Iran and Turkey, in addition to those already signed with China, Serbia and Vietnam. Attending the May 26 Forum was the Secretary General of the Shanghai Cooperation Organization, Chinese diplomat Zhang Ming, who captured the spirit dominating the discussions. He called for the EAEU and the SCO to “unite forces,” to face the global crisis and “build a new world order”. As he pointed out, “the population of the SCO is over 3 billion people, this is half the population of the Earth”.

The need for the development of alterantive currency arrangement was addressed by numerous speakers, including Glazyev. The chairman of the Eurasian Economic Commission, Mikhail Myasnikovich, expressed the view that “not only trade and payments in national currencies should be on our agenda. We need to discuss the construction of an independent monetary system, an independent currency system…”

Another prominent issue was the development of pioneer technologies. Belarusian Deputy Prime Minister Igor Petrishenko suggested assessing the effectiveness of Eurasian technological platforms that are needed for introducing advanced technology into manufacturing, such as optics and microelectronics which, in the case of Belarus, “served as a springboard for the development of Belarus’ own space industry”.

Another factor that should spur development in all of Eurasia is Moscow’s commitment to create new clusters of industry in the Donbass and to rebuild the region’s heavy industry, much of which was shut down years ago, on the insistence of the European Union as a precondition for cooperating with the Ukrainians. The de-mining and clearing of the port of Mariupol and adjacent coastal areas at the Azov Sea will help make the north-eastern Black Sea a naval transport artery of the EAEU.