Heads of the CIS countries are looking for new forms of integration.
A meeting of the Russia-Belarus-Kazakhstan Customs Union and a session of the Eurasian Economic Community's intergovernmental council, hosted at the Boris Yeltsin Presidential Library in St Petersburg last Friday, seemed rather formal. The two events ended even before Vladimir Putin's scheduled meetings with his counterparts from the CIS. All the main decisions on establishing a Customs Union had already been discussed and the prime ministers simply signed the documents.
However, Vladimir Putin added colour to the meeting. "The CIS and other organisations have much been criticised. And we have to admit that they spent much time on declaring things," the Russian prime minister said. Nevertheless, he added that the organisations were useful. Putin sees establishment of a Customs Union as real progress in reviving the broken economic ties between the former USSR countries.
Russian Deputy Economic Development Minister Andrei Slepnyov demonstrated to journalists the advantages of the Customs Union in the library's multimedia hall, which hosted the press center. The prime ministers of Russia, Belarus, Kazakhstan, Kyrgyzstan and Tajikistan also came to watch the short movie. The two latter countries are not joining the union, but may want to after watching the movie.
The movie showed a truck that delivered components from a factory in Chelyabinsk to a refrigerator factory in Belarus. After that, a train delivered refrigerators to Kazakhstan to their end users. The whole route went without any customs clearance, as if across a single territory, since the borders between the countries would be the external borders of Belarus and Kazakhstan.
To make the scheme work, the countries had to change their import duty rates. Russia kept 82% of its rates unchanged, Belarus maintained 75% and Kazakhstan - only 45%. The latter increased 45% of its rates, with Russia and Belarus raising 4% and 18% respectively.
The prime ministers have often compared the Customs Union with the European integration model, though in this particular case the integration is taking place around Russia's economy alone rather than that of several countries.
Putin intends that it will go further and establish a joint currency possibly using the rouble as a basis. It is not in vain that he and President Dmitry Medvedev have been saying since the beginning of the year that the dollar is losing its world leadership and that strong regional currencies, including the rouble, should enter the arena.
"This is all about coordinating our economic policies, our currency policies in the near future, our trade policies and coordinating support for certain industries," Putin said on Friday. He called for other Eurasec members to join the Customs Union as soon as their economies were ready. The way new members have joined the European Union.
Andrei Biryukov