Pseudo-debates on the urgency of choice

It looks like the discussion on the necessity of accession to the Customs Union, imposed by some political forces in this country (contrary to the line on the EU integration, previously declared by Ukraine), is not getting anywhere. Conversely, more and more Ukrainians are supporting the country’s joining the European club of nations, which unites more than 500 million citizens. “The people have sensed that European integration is slipping away from them,” said Iryna Bekeshkina, director of the Democratic Initiatives Foundation, a think tank, as she commented on past years’ tendency among Ukrainian citizens to prefer rapprochement with the EU rather than with the Customs Union.

According to Bekeshkina, the results of a nationwide poll, held by the Ilko Kucheriv Democratic Initiatives Foundation jointly with the sociology service at the Razumkov Center, show that in December 2012 as much as 48 percent of Ukrainian citizens believed that Ukraine should join the EU, whereas 40 percent were in favor of joining the Customs Union with Russia, Belarus, and Kazakhstan. Meanwhile, another poll held in August 2012 had revealed that 45.2 percent of respondents backed Ukraine’s accession to the Customs Union, whereas 43.8 percent were for the EU.

Perhaps, the Russian Foreign Minister Sergey Lavrov’s statement to the effect that the Russian leadership sees no contradiction in both countries’ desires to consolidate their relations with Europe while strengthening interaction in the CIS space is no mere coincidence. “Our countries are independent in defining their political priorities in the European direction, but we share a common interest in building a united Europe without division lines. Therefore we see no conflict in our countries’ rapprochement with the European structures and the extending of diverse-format integrations in the CIS space, because this is a matter of two mutually complementary policies,” said Lavrov as quoted by media prior to the talks with his Ukrainian counterpart Leonid Kozhara in Chernivtsi on January 13.

Moscowmight have at last realized that, despite the Kremlin’s furious pressure, the incumbent government of Ukraine does not wish to join the Customs Union and only wants to cooperate on the mutually profitable basis. The seriousness of Ukraine’s Euro integration intentions is obvious from the statement made by Prime Minister Mykola Azarov, who said that he was going to coordinate the fulfillment of the EU-Ukraine association agenda. The prime minister emphasized that the government’s priorities included the unconditional implementation of the plans on lifting the visa regime, which were agreed with Ukraine’s European partners, the creation of the free trade area without exceptions and limitations, and the signing of the EU-Ukraine Association Agreement on the whole. “The dialog with the EU is gaining momentum, this year such principal integration events are slated as the meeting of the EU-Ukraine Cooperation Council, the EU-Ukraine summit, and the Eastern Partnership summit. Therefore our Euro integration efforts should be as serious, effective, and responsible as possible,” said Azarov.

We could only welcome this statement by Prime Minister Azarov, together with his resoluteness to make progress on the path towards the EU. But will it dampen the zealotry of those think tanks which propagate Ukraine’s integration in the Customs Union? Here belong, first and foremost, Viktor Medvedchuk’s “Law-Governed State” and Anatolii Orel’s Center for International and Comparative Research (by the way, the latter was for a long time the boss of the current foreign minister Kozhara).

What threats or dangers would our country face if it joined the Eurasian club made up by Russia, Belarus, and Kazakhstan? The Day has answers from a Kazakh, Belarusian, and Ukrainian experts.

By Mykola SIRUK, The Day

COMMENTARIES

THE CUSTOMS UNION HAS SPLIT THE KAZAKHSTANI SOCIETY IN TWO

Dosym SATPAEV, Director, Kazakhstan Risks Assessment Group:

“Unfortunately, Kazakhstan loses more than it wins from the participation in the Customs Union. This is even acknowledged on the official level, by the way. Past year several statements were made by our MPs and spokesmen from major ministries to the effect that since its accession to the Customs Union, Kazakhstan had begun to import more products from Russia and Belarus rather than export its own production. Many account for this fact by saying that economically Kazakhstan is predominantly a raw material supplier. That is to say that Kazakhstan’s export consists mostly of raw materials, and Belarusian and Russian products have a niche on our market even if their quality leaves much to be desired, because our manufacturers cannot compete with them. Moreover, this year Kazakhstan is going to join the WTO, which has ever tougher conditions.

“One more thing is that there was a political declaration of ‘creating the common economic space,’ but it turned out that the devil hides in the detail. Today all those neglected issues are surfacing which are now beginning to block the access of a limited category of Kazakhstan’s goods to Russia’s markets. In particular, I mean the creating of artificial obstacles by Russia for Kazakhstan’s products.

“Thirdly, the Customs Union has split the Kazakhstani society in two. It has its both supporters and opponents, who claim that the Customs Union has brought Kazakhstan more harm than good. They see it as disguise for Moscow’s geopolitical interest. Of course, the Russian population of Kazakhstan supports our accession to the Customs Union. However, among the titular nationality very many are against the Union, as they believe it to pose ‘a threat for the country’s sovereignty.’

“One of the advantages of Kazakhstan’s membership in the Customs Union was the creation of a common space for the shipment of goods, services, and labor. Now it is easier for Kazakhstani specialists to find jobs in Russia, but they do not use the opportunity.

“The future of the Customs Union is very ambiguous. This is because it is hard to predict its fate after the change of governments in Kazakhstan and Belarus. It is no secret that the idea belonged to Nazarbayev, who voiced it back in the 1990s. But no one knows what is to come after him. Will the future leaders be as willing to actively cooperate with Russia? Maybe, Kazakhstan will even opt out of the Customs Union. The same goes for Belarus. Hypothetically, pro-Western politicians can gain power in Ukraine, and you will also start having trouble with this project. Russia could remain on its own. This poses a grave problem, and the Kremlin is very well aware of it.”

FULL INTEGRATION INTO THE CUSTOMS UNION COULD JEOPARDIZE ENTIRE INDUSTRIES OF BELARUSIAN ECONOMY

Andrei KAZAKEVICH, expert on political science, editor-in-chief, magazine Politicheskaya sfera, Belarus:

“The major advantage of Belarusian membership in the Customs Union is easy and transparent access to the eastern markets of Russia and Kazakhstan.

“This project being political rather than economic, membership enabled Belarus to get all kinds of preferences from Russia.

“The price Belarus paid for its membership in the Customs Union sooner falls under ‘disadvantages.’ The major price was our limited sovereignty. A lot of regulations, passed in the framework of the Customs Union, were formulated with a negligible involvement on the part of Belarus.

“Belarus’ participation in this integration association means further loss of its international political capacity. In particular, the opportunity for cooperation with the EU and individual countries is reduced, since our economic policy is largely based on the decisions made outside Belarus. The European prospects are becoming more and more illusory, we are losing the possibility to balance between Europe and Russia, and we are losing our independence in the defining of our economic and political policy. The Customs Union being a political association, the political influence of Russia has grown. Over the past two years Belarus’ cooperation with Europe has sunk and is virtually frozen now.

“Observers believe that there is an additional negative factor: a full integration to the Customs Union could jeopardize entire industries of Belarusian economy. They could prove unable to compete with some Russian enterprises.”

THE CUSTOMS UNION IS NOT A TOOL TO STIMULATE DOMESTIC ECONOMIC REFORM

Ihor BURAKOVSKY, Director, Institute for Economic Research and Political Consultations:

“Today we virtually have a free trade regime with all the Customs Union member states. Therefore our accession would change nothing for Ukrainian manufacturers, present in those markets.

“Secondly, if we join the Customs Union, we must revise our responsibilities to the World Trade Organization, i.e. to those countries which negotiated our accession to the WTO and which would demand compensation from Ukraine. On average the customs rate in the Customs Union is higher than the one we have in the WTO.

“Thirdly, the Customs Union countries are not, putting it mildly, advanced economies. If so, we cannot expect an additional effect in technology, additional influx of capital, and so on.

“Next, the Customs Union has not shown its worth as an organization so far. On the formal plane there is a customs union, there are issues of the flow of goods, and a simplified system of border-crossing. But it is still too early to speak of any real economic effect of the Customs Union for its member states. In my opinion, when Belarus and Kazakhstan joined it, they pursued political and economic interests. Besides, this organization’s documents say nothing of setting prices for gas or other energy carriers. Thus the preferential gas prices which we could potentially get depend solely on Russia’s leadership.

“In my view, the Customs Union is not a tool to stimulate domestic economic reform. We should clearly realize that the Union stands for unguaranteed markets with competition for goods. It does not eliminate the necessity of reform. On the other hand, Ukraine could modernize its economy relying primarily on the Western capital and technology. It is Ukraine’s cooperation with the EU and G20 that would serve as a source for the upgrading of its economy. I see nothing of this in the Customs Union.”

Interviewed by Ihor SAMOKYSH, The Day