A Russia-Led Integration

By+Chen+Yurong

The Eurasian Economic Union （EEU）， a Russia-led trade bloc， came into being on the first day of 2015， marking a milestone for the economic integration of the Commonwealth of the Independent States （CIS）， the members of which have remained separate since the Soviet Union was dismantled in 1991.

The EEU members will implement a series of policies addressing customs， free trade， free movement of labor and other measures aimed at boosting the economies of the member states. By the end of 2025， the Eurasian economic group will have established a common market. Besides Russia， the bloc includes four states： Belarus； Kazakhstan； Armenia， which joined the group on January 2； and Kyrgyzstan， slated to become a full-fledged member on May 1.

The EEU was established on the foundation of a customs union consisting of Russia， Belarus and Kazakhstan when leaders of the three countries signed the Treaty on the Eurasian Economic Union last May in Astana， capital of Kazakhstan.

Russian President Vladimir Putin said in Moscow at a leaders meeting of the EEU last December that the blocs membership is not limited to the CIS states， adding that he welcomes the participation of Russias neighbors—both East and West.

According to the State Duma， Russias parliament， 28 countries have expressed interest in cooperating with the EEU. Iran and Turkey， for instance， have both sought to take part in a free trade zone representing the sole avenue of cooperation pursued between EEU and non-CIS countries thus far. Viet Nam closely followed a precise roadmap in its bid to join the free trade zone but to no avail.

Russia intends to overcome current economic hardships and cement its geopolitical influence with the help of the EEU. In 2011， Putin mapped out a chart to build an economic union. The establishment of the EEU has been hailed as a major diplomatic achievement for Putin since his return to the Kremlin in 2012.

The EEU covers a huge market of 170 million people stretching across vast areas of the CIS countries. Putin envisions shaping the EEU into a Russia-led integration bloc spanning from Eastern Europe to the Asia-Pacific， creating a new pole for the world economy. Thus， Russias resurgence will depend largely on the economic and military integration of the CIS states.

Challenges ahead

Russia hopes the EEU will be an effective counterweight to the expansionary efforts of its Western rivals. However， some uncertainties remain.

As the core of the EEU， Russias ability to act as a dynamic economic engine supporting the integration bloc is questionable. Indeed， the timing of the EEUs debut seems unfavorable as Russia struggles on the brink of economic crisis. Hit by Western sanctions and falling oil prices， the exchange rate of the ruble， Russias currency， has dropped sharply in recent months. The current economic hardships spell dire prospects for 2015， and Russia must first address its domestic problems rather than rely on the EEU to help it weather Western sanctions and expand its market.

With external rivals posing additional challenges amid the ongoing Ukraine crisis， the EEU takes on even greater geopolitical significance.

From the moment Russian President Putin suggested creating the EEU， critics from the United States and Europe pounced on the idea. U.S. Secretary of State Hillary Clinton vowed to stop Russia from restoring the Soviet Union through such means of economic integration.

The Eastern Partnership Initiative launched by the European Union （EU） in 2009 is a major measure designed to foil the integration of the CIS states. The EU plan intends to forge close political and economic ties with six former Soviet republics—Armenia， Azerbaijan， Belarus， Georgia， Moldova and Ukraine—in exchange for democratic reforms but without the prospect of eventual EU membership.

Through this initiative， the EU plans to establish free trade areas with the six states， as well as to offer technical expertise， security consultations and millions of euro in economic aid.

Russian Foreign Minister Sergey Lavrov has repeatedly warned against the creation of new dividing lines in Europe. He accused the EU of trying to carve out a new sphere of influence in the six CIS states and forcing them to take side between Russia and the West.

The EU and Russias vying with one another for the prize of Ukraine has played a direct role in causing the formers present crisis. In November 2013， at large economic cost， Russia persuaded then Ukraine President Viktor Yanukovych to suspend the signing of the association treaty with the EU. In the immediate aftermath of that decision， widespread protests erupted in the country and ultimately caused the ouster of Yanukovych in February 2014. Advanced by the pro-Western government， Ukraine signed the association treaty with the EU in Brussels last June. The former Russian partner will join a free trade zone with the EU by the end of this year.

Apart from the EU， the Ukraine crisis also illustrates geopolitical competition be- tween Russia and the United States. Russia has repeatedly accused the United States of backing a “color revolution” in Ukraine. U.S. senators John McCain and Chris Murphy appeared in Kiev on December 15， 2013 and delivered speeches to opposition groups， stoking the climate of opposition to the Yanukovych administration. The protests in Ukraine soon spiraled out of control. It was also the United States that brought its European allies together to impose sanctions against Russia， causing heavy economic damage to both Russia and the EU.

In Europe， competition between the two rival groups has begun in earnest， as both the EU and the Russia-led EEU compete for the affections of the remaining CIS states. Some Eurasian countries have hesitated to declare which side they will join. On January 12， President of Uzbekistan Islam Karimov said at a parliament meeting that his country would not join the EEU or any other customs union. He further asserted that Uzbekistan will not become a member of any military or political alliance at any stage in the foreseeable future.

Opportunities

Russias neighbor China is currently working to build the Silk Road Economic Belt together with Eurasian countries. Many have argued that Chinas initiative will inevitably clash with the EEU. However， if we take into consideration the nature of the Chinese economic proposal， the two initiatives are in effect highly compatible and could even draw strength from each other.

Unlike the EEU， Chinas initiative is a loose international cooperation proposal based on mutually beneficial results. The EEU aims to promote regional integration， whereas the Silk Road Economic Belt calls for enhancing connectivity. China welcomes all countries to participate in the economic belt.

The EEU and the Silk Road Economic Belt initiative will combine to form a blueprint for the Eurasian continent. The two will both be present in Central Asia， an important area for both Russia and China. As part of the CIS， Central Asia represents the bridge linking China and Europe. Most Central Asian countries firmly support the economic integration of the CIS states and enjoy close economic and trade ties with both China and Russia， which will help them handle various economic cooperation initiatives properly.

More importantly， China and Russia have established a comprehensive strategic cooperation partnership. The two countries have reached a consensus to work for common development through mutually beneficial cooperation. The Shanghai Cooperation Organization is a positive example of what China， Russia and their Central Asian partners can accomplish together. A peaceful and prosperous Central Asia conforms to the fundamental interests of China and Russia. In the future， the EEU and the Silk Road Economic Belt can together spur the economic growth of Eurasian countries. China and Russia should seize the opportunity to strengthen their respective economies.