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Kyrgyzstan and prospects in EEU

On February 6 Moscow hosted the first meeting of the Eurasian Intergovernmental Council - the governing body of the EEU, which will take most of the decisions regulating economic activity and cooperation within the Union. The meeting was attended by the Kyrgyz delegation headed by Prime Minister Djoomart Otorbaev. Participants discussed the main directions of the work for the near future.

Among the key issues were the most important aspects of the organization’s activities like implementation of a coherent industrial and agricultural policy, development of export and industrial cooperation, implementation of joint investment projects; development of the concept of a common energy market, the development of services, openness in the dialogue with the WTO.

Kyrgyzstan signed the Treaty on joining the Eurasian Economic Union (EEU) on December 23, 2014 and officially will become a member of the EEU in early May of this year. In fact, the country joins the biggest association with a consumer market of more than 170 million people. The association will be guided by the norms and principles of the World Trade Organization (WTO) and will ensure free movement of goods, services, capitals and labor force between the member-states, currently comprising Russia, Belarus and Kazakhstan.

The Treaty outlines all protective mechanisms and preferences, as well as Kyrgyzstan’s share in distributing customs duties derived from the importation of goods into the EEU, which will make 1.9%, which is not small, initially this figure was much lower - 0.6% at the beginning of negotiations.

Joining such unions is dictated by realities of time and economic feasibility. Otherwise, the economy of Kyrgyzstan can face stagnation and decline, and it is not just speculations. It is impossible to develop outside the integration in the modern world. At the same time, for many years, volume of trade of Kyrgyzstan with three countries of the Union makes about 44%, which means that the expansion of foreign economic relations with them is possible only within the Union. For example, according to official data, during the existence of the Customs Union, trade between Russia, Belarus and Kazakhstan increased by 50%.

In addition, strengthening of control at the external borders of the Union will save Kyrgyzstan from poor quality (and sometimes harmful) products and foods that are freely imported to the territory of the republic, and certification of domestic products will allow local producers to enter the promising common market of Eurasian integration.

Participation of Kyrgyzstan in the EEU will provide not only tax free transportation of goods, but also creation of a single transport, educational and cultural space. There will be free movement of capital, services, and very important for Kyrgyzstan, the labor force. Today, about a million Kyrgyz migrants live and work in Russia. This is a large enough figure for a country like Kyrgyzstan, which has a population of 5.5 million people.

After joining the EEU significant number of Kyrgyz migrant workers will be able to move without restrictions and enjoy the rights of host countries. For example, the rights of workers from Armenia, which signed an agreement to join the EEU on the eve of the New Year, have been equated to the rights of citizens of Russia.

Besides, within the framework of the EEU there will be no bureaucratic obstacles in the form of various taxes and customs controls at internal borders of the Union, free transit provides reduction of trade costs and create favorable conditions for exporters of domestic products, which still face some difficulties in crossing boundaries. Just because of tighter border control, exports of Kyrgyzstan to the CU countries in 2013 decreased by 21.5% compared with 2010.

At the same time, joining the EEU will give the possibility of energy supply within the union without export and import duties, which provides stable supply of fuel and lubricants. Today Kyrgyzstan exports 95% of its needs of total volume of petroleum products, 90% of which is imported from Russia.

According to experts’ opinion, further survival and development of the countries on the Eurasian space directly depends on close economic ties within the region. And integration for these countries is the only way out of many crisis situations and the ability to develop the national economy.

Nurzhan Kasmalieva

Kabar News Agency

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