Press-releases of the Embassy

Press statement following the Supreme Eurasian Economic Council meeting

May 29, 2014, 12:20 Astana

PRESIDENT OF RUSSIA VLADIMIR PUTIN: Friends, colleagues, ladies and gentlemen,

I would like to stress that the governments of Russia, Belarus and Kazakhstan jointly with the Eurasian Economic Commission managed to complete the drafting of the Agreement on the Eurasian Economic Union as was planned - by June 1, 2014.

As you may know, this process was launched in 1994, when Mr Nazarbayev first described this idea speaking at Moscow State University. It was then developed at a variable pace. In 2009, the President of Kazakhstan yet again gave it additional impetus and we agreed to intensify our efforts in this direction.

I am happy to say that there is popular consensus on this idea in Russia. Whoever was President (back then it was Dmitry Medvedev) we always actively supported this and continued the work on it at Government level.

The Agreement we signed is a truly historical milestone that opens up broad prospects for the development of our economies and improving the well-being of our countries citizens.

Russia, Belarus and Kazakhstan are moving towards a completely new level of cooperation by creating a common space where goods, services, capital and work force can move freely. The three states will follow a coordinated policy in such key branches of the economy as energy, industry, agriculture and transport.

This was not an easy job and until now it was difficult to come to agreement on all these issues. We moved along, even though it was with heated disputes, I would not say with rows, but with serious disagreements. We will continue to move ahead in the same way based on mutual understanding and a desire to achieve compromise acceptable to all.

We are essentially creating the largest common market on CIS territory (with over 170 million people) with an enormous production, research and technological potential and huge natural resources.

It is not surprising, and I will dwell on it a bit later, that major economies are already showing direct interest in this union. Wherever I go and whomever I meet everyone wants to know how to establish relations with the new Eurasian Union.

A new economic organisation has appeared on the international arena, one that has full juridical personality and acts based on the principles of the World Trade Organisation. It is important that the transfer of certain authority to supranational agencies of the Union is of no detriment to the sovereignty of our states.

Mutual benefit from integration has already been demonstrated in practice. The economic ties between Russia, Belarus and Kazakhstan are expanding, their trade structure is improving, the share of high-tech goods in the overall trade structure is increasing and our countries are becoming ever more economically competitive in the world.

In the past three years trade turnover within the Customs Union has gone up by 50 percent that is by $23 billion (in 2013 it amounted to $66.2 billion). Belarus and Kazakhstan together come in third in the overall trade balance of the Russian Federation (after the EU and China). However, let us compare: our trade turnover with the EU is 440 billion, and with China it is 87. Belarus and Kazakhstan are much smaller in terms of economic volumes than these two world economic giants are, but they rate third in their trade with Russia. This shows that we have reached this level mainly due to our integration.

With this in view, we have considered in detail with our partners today how we can use the potential of the Eurasian Economic Union to enhance the flow of goods and investment and expand industrial and technological cooperation.

Special attention is given to improving the business climate. Russia, Belarus and Kazakhstan intend to stimulate responsible competition on the Union market. At the same time, we will efficiently protect the interests of the consumers and the businesses of the member states.

For the future, we have set ourselves the goal of creating a common financial market. The absence of barriers in the flow of capital will make it possible to diversify risks and improve the quality, accessibility and reliability of financial services.

Stage-by-stage harmonisation of the currency policy will serve to enhance the stability of the financial systems of the Union member states and will make the national money markets more predictable and better protected from exchange rate fluctuations, and will enhance our sovereignty as well.

The citizens of our countries should be able to fully assess the benefits of Eurasian integration. They will receive the right to work freely in the three states without having to obtain any work permits.

Of course, we touched upon the issue of expanding membership in the Eurasian Union, as Mr Nazarbayev already mentioned, and we have considered the draft agreement with Armenia. This document should be approved and signed shortly. Armenia would like to have this done in June. Overall, we all agreed. We expect that shortly after the Union is set up, Armenia will become its full-fledged member.

We also discussed the prospects for other partners joining the Union, primarily Kyrgyzstan. We have just had a detailed discussion with the President of Kyrgyzstan. I believe chances are high, though there is still a lot of work to be done to draft the relevant documents. We are ready to help, and Kyrgyzstan has every chance of joining the Union soon.

We agreed to step up our negotiations, as I already said, with Vietnam on creating a free trade zone, to strengthen cooperation with the Peoples Republic of China, specifically in the exchange of customs information on goods and services, and to form expert groups that would work out preferential trade regimes with Israel and India.

I am convinced that through joint efforts we will be able to create favourable conditions for the development of our economies in order to maintain stability, security and prosperity in Eurasia.

Congratulations.

Thank you for your attention.