Reglamento Interno de la Comuna

Regional (economic) integration was initiated immediately after there break-up of the Soviet Union, although the forms that occurred differed widely. The main reason for these various forms of coope- ration and integration was to salvage the economic and business ties between the newly established republics. “While the main priority for all the newly established states was to achieve full economic and political sovereignty, it was understood that economic development and improving living standards would be much more difficult to achieve unless ties were preserved” (Eurasian Economic Commission, 2013: 6). The level of integration in the region has varied over time. The Eurasian Development Bank has created a ‘System of Indicators of Eurasian Integration’ that measures the level of integration in the former-Soviet Union. Generally speaking, there is a trend of decline of integration in this region since 2000, but Russia, Kazakhstan and Belarus have become more inte- grated. These three economies form an ‘integration core’ in the post-Soviet space (Vinokurov, 2012). To describe the process of intended integration in the Eurasian region, I will highlight four organizations that roughly embody the integration process: the Commonwealth of Independent Sta- tes (CIS), the Eurasian Economic Community (EurAsEC), the Eurasian Customs Union (ECU)

combined with the Single Economic Space (SES) and the Eurasian Economic Union (EAEU) (See

figure 4.0). Furthermore, I will give insights on the future prospects of the EAEU, since the Union has only been established very recently. In addition, I will give a short overview of the political and economic position of the current member states of the EAEU.

Figure 4.0 Evolvement of Eurasian Economic Integration

(Eurasian Commission, 2015; author’s graphics).


Commonwealth of Independent States (CIS), 1991 Eurasian Economic Community (EurAsEC), 2000

Eurasian Customs Union (ECU), 2010 Single Economic Space (SES), 2012

Eurasian Economic Union (EAEU), 2015

The Evolvement of Eurasian Integration

4.1 Commonwealth of Independent States (CIS) The treaty establishing the Commonwealth of Independent States (CIS) was signed on the 8th of December 1991 by the presidents of Belarus, Russia and Ukraine at a meeting in Belovezhskaya Pushcha in Belarus. Other former Soviet republics endorsed the CIS two weeks later at a special summit in Alma-Ata, the current Almaty (Kazakhstan) (Eurasian Economic Commission, 2013). The president of Kazakhstan, Nursultan Nazarbayev had been an advocate of republican sovereign- ty but also wanted to maintain the single economic space and was in this respect the initiator of the CIS. The original idea of the bigger Soviet republics (Belarus, Russia and Ukraine) was to form a ‘Slavic Union’, but Nazarbayev convinced the leaders of these countries to form a broader, more inclusive commonwealth (Zhalimbetova & Gleason, 2001).

The initial goal of the CIS was to collaborate in re-creating a common economic space and to set up principles of cooperation through coordinated institutions. The common economic space would be based on a free-trade area, which was immediately the final goal of the Commonwealth leaders. They did not, and still do not, want to create a form of regional integration other than a free-trade zone (Eurasian Economic Commission, 2013). The sovereignty of the newly independent republics had to be ensured and the signatories believed that this goal could be accomplished wit- hout sacrificing the former Soviet unified economic space. Though this proved to be an illusion, because the Soviet successor states rapidly found themselves at odds with one another on a wide range of trade and security issues. “The Post-Soviet states moved towards the market at different speeds, and with differing emphasis, creating policy asymmetries and conflicts with their neigh- bors” (Zhalimbetova & Geason, 2001). Moreover, Russia played an ambiguous role in the CIS. It frequently fell back into its role as ‘ruler’ and tried to play the role of the Eurasian ‘center’. Alt- hough it can be argued that Russia’s efforts to make the CIS a success were aimed at restoring poli- cy harmony, the other countries interpreted it as motivated by Moscow’s nostalgia for empire in- stead of a desire to restore cooperation.

Though the aspirations of the member countries and the CIS itself were high, it did not ma- nage to become more than an ‘empty box’. “In reality, the CIS agreements incorporated little in the way of effective sanctions and enforcement powers. The agreements that followed over time ex- pressed intentions, but did little to create working mechanisms” (Zhalimbetova & Gleason, 2001). Libman (2011) characterizes this period of regionalism in the CIS as the ‘high season of integration rituals’. Meetings of the CIS governing institutions adopted a variety of acts and agreements which

were usually never implemented. This is also highlighted by the diminishing importance of the CIS. The presence of presidents of the member states at summits seems to be decreasing from year to year (Libman, 2011).

4.1.1 CIS Governance Structure The integration of the CIS member states is executed by the so-called coordinating institutions. These include the charter bodies, the executive bodies and the bodies of branch cooperation of the CIS (CISSTAT, 2015). The charter bodies of the CIS are: the Council of the Heads of State (CHS), the Council of the Heads of Governments (CHG), the Council of Foreign Ministers (CFM), the Council of Defense Ministers (CDM), the Council of Borders Guard Commanders (CBGC), the In-

ter-Parliamentary Assembly (IPA), and the Economic Court (EC) (See figure 4.1) (Libman, 2011).

This institutional design was already set up at the Minsk agreement, but took its present shape through the CIS Articles that followed. The three highest bodies of the CIS; the CHS, the CHG and the CFM are purely intergovernmental and include officials from each member state. The most im- portant decision are made, and the general agenda is set, by the heads of state of the member coun- tries within the framework of the CHS. Its presidency functions on the basis of rotation and decisi- ons are purely consensus-based (Libman et al., 2011). The CHG on the other hand, has an agenda mostly concentrated on economic affairs and social policy, as well as monitoring the CIS agencies. It works on the same principle as the CHS. Both these Councils have to sole right and ability to pass

binding decisions, the other institutions, such as the Executive Bodies of the CIS , only have the 2

advisory capability (Libman et al., 2011). The last CIS institution that is worth mentioning is the Economic Court (EC). The EC mostly deals with interstate economic disputes, though the judge- ments made by the Court are generally not legally binding. This makes the impact of the EC rather limited and insignificant (Libman, 2011).

“The Executive Bodies of the CIS are: the Economic Council, the Council of Permanent Plenipotentiary Representati

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ves of the States-Participants of the Commonwealth under Charter and Other Bodies of the Commonwealth, and the Executive Committee” (International Democracy Watch, 2012).

The Evolvement of Eurasian Integration

Figure 4.1 Structure CIS

(Libman, 2011; author’s graphics).

In 2007, a ‘Development Concept’ was launched to institutionally transform the CIS, to strengthen the role of the CPR, the Economic Council and the IPA and most important, to focus on the economic area as the main goal. The institutional reforms suggested by the Concept maintained the existing institutional structure of the organization, but was an attempt to be more efficient by reducing redundancies. As stated by Libman: “There seems to be little or no movement to the esta- blishment of the supranational institutions and only a limited increase of the capacity of the IPA” (Libman, 2011: 17-18). Thus, the CIS will remain (and would also remain in this proposal) largely based on a intergovernmental governance structure in which only the heads of state and government have the authority to pass binding decisions, and only by consensus.

4.1.2 Policy Areas As mentioned above, the initial goal of the CIS was to collaborate in re-creating the common eco- nomic space of the Soviet Union. Many arrangements adopted at the creation of the CIS were in-

Council of the Heads of State (CHS)

Council of the Heads of Government (CHG) Economic Court

Council of Border Guard Commanders (CBGC)

Economic Council (Deputy Heads of Governments of MS)

Council of Defense Ministers (CMD)

Council of Foreign Ministers (CFMA) Executive Committee (Permanent executive, admi- nistrative and coordinating body)

Inter-Parliamentary Assembly (IPA) Intergovernmental Bank Council of Permanent Representatives (CPR)

tended to coordinate monetary, customs, employment, tax, and investment policies and thus pointed in this direction (Zhalimbetova & Gleason, 2001). Multiple agreements followed the initial Minsk agreement of ’91. May 1993 marked the adoption of the declaration to establish an Economic Union Treaty. The goal of this treaty was to foster a free trade area, create common external tariffs, reduce internal tariffs and establish a system of payments and settlements. The Treaty was enhanced with impressing sounding but ultimately ineffective subsidiary agreements on free trade (April 1994), payments, (October 1994), and customs (January 1995), legal harmonization (January 1996), customs classification lists (February 1996), and railway tariffs (October 1996). Many of these trea- ty outcomes were never adopted and implemented by the member states and currently the CIS has restricted its attention to specific areas of functional cooperation, such as electricity, railroads, avia- tion and humanitarian issues (Libman, 2011).

4.2 Eurasian Economic Community (EurAsEC) An important step of Eurasian integration was taken in 2000 when Russia, Belarus, Kazakhstan, Kyrgyzstan and Tajikistan established the Eurasian Economic Community. Uzbekistan joined this community in 2006 and already left two years later after improving its relations with the European Union. As important previous treaties, the new arrangements that established the EurAsEC were signed in the Kazakhstani capital Astana in October 2000. It was mostly based on the already exist ing Customs Union agreements (that were never implemented), but was “designed as the logical step in an incremental movement toward policy harmonization” (Zhalimbetova & Gleason, 2001). Furthermore, the EurAsEC was the first organization designed to function as an actual regional in- ternational organization, in contrast with the CIS. This was made possible because of the idea of a multi-speed integration, which was strongly promoted by proponents of further cooperation, such as Russia and Kazakhstan. Though this required a new institutional framework, hence the establish- ment of the Eurasian Economic Community (Libman, 2011). The main priority of the EurAsEC was to promote even further integration between the member states and to guide the implementation of the Customs Union and the Single Economic Space. The founding treaty of the EurAsEC states very clearly that, the Contracting Parties; the member states, retained their sovereignty. “The Com- munity shall have such powers as are voluntarily transferred to it by the Contracting Parties in ac- cordance with the provisions of this Agreement. The Contracting Parties remain sovereign and full- fledged subjects of international law” (The World Bank, 2000: Article 1).

The Evolvement of Eurasian Integration

Closely connected the the Community is the Eurasian Development Bank (EDB), which was established by Russia and Kazakhstan in 2006 as a regional development bank for the former Soviet region. Armenia, Belarus and Tajikistan later joined the EDB. The main focus of the organization is not to provide common institutions and to facilitate formal cooperation, but rather to supply finan- cing for specific projects as a means to intensify regional cooperation (Libman, 2011).

4.2.1 EurAsEC Governance Structure While the EurAsEC was not intended to limit the sovereignty of the participating states, it did pro- vide for the delegation of some negotiating responsibilities within international organizations. Examples of these are the Integration Committee, the Inter-Parliamently Assembly, and the EurAs- EC Court (See figure 4.2). In this respective, it had greater enforcement powers than its predecessor. This optimism can be tempered by making a comparison between the competences of the Commis- sion and the Court compared to its European counterparts: the European Commission and the Court of Justice. Although, it can be seen as first step in building a strong law-based community (Block- mans, 2012).

Figure 4.2 furthermore shows that, in line with the CIS, the Heads of State and Government; the Intergovernmental Council, was the most important body of the EurAsEC. Its task was to devel- op the key directions of further integration of the organization. In line with the CHS and the CHG, the decisions of the Council were mandatory for the member states and as a consequence had to be implemented through national legislation. Though decisions were consensus-based, which questions its efficiency. (Libman, 2011). The extensiveness of control of the Interstate Council is made clear by Article 3 of the EurAsEC founding treaty. It states that the Interstate Council is authorized to terminate the functioning of the integration management bodies (The World Bank, 2000).

The Integration Committee, the main executive body, assisted the Intergovernmental Coun- cil, prepared its agenda, suggested proposals towards enhancing and developing regional integration and monitored the implementation of decisions made by the Council. As it included the deputy pri- me ministers of the member states, it can be considered as fully intergovernmental. The Permanent Representatives Committee on the other hand, can be considered as a supranational body within the Community. It played an intermediate role between the organization and the member states and en- sured the functioning of the EurAsEC in the periods between the session of the Intergovernmental Council and the Integration Committee. The Parliament had, in line with the CIS Parliament, quite an insignificant role in the EurAsEC structure. The IPA could give recommendations for further in-

tegration and ensured a good cooperation between the Community and the member states. Decisi- ons within this body were based on a weighted voting system and taken by two-third majority,

which basically gave Russia a veto power . Lastly, the Court of the Community resolved the dispu3 _-

tes that arose between the member states over the implementation of EurAsEC decisions. Since 2004, the functions of the Court were delegated to the Economic Court of the CIS, so there was no longer a special Community institution established in this area. The Court could only make decision based on a two-third majority, which is more limited compared to the CIS Economic Court, though the decisions made by the Court of the Community were binding for the member states.

Figure 4.2 Structure EurAsEC

(Libman, 2011; author’s graphics).

An important feature of the EurAsEC that was later added is its permanent supranational regulatory body, the Eurasian Customs Commission (ECC) (later Eurasian Economic Commission). This Commission had basically the same functions as the Integration Committee (Libman, 2011). The parties involved, Belarus, Kazakhstan and Russia worked out an agreement on the EEC on No- vember 18th 2011. Based on this agreement, the EEC began working on the 2nd of February 2012.

“The headcount of parliamentary delegations at the IPA is as follows: Republic of Belarus: 16 parliamentarians, Repu

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blic of Kazakhstan: 16 parliamentarians, Kyrgyz Republic: 8 parliamentarians, Russian Federation: 42 parliamentarians, Republic of Tajikistan: 8 parliamentarians, Republic of Uzbekistan: 16 parliamentarians. Therewith, every parliamenta- rian shall have one vote” (Eurasian Economic Community, 2006: Chapter III).

Industrial Councils and Commissions Permanent Representatives Committee Inter-Parliamentary Assembly (IPA) Integration Committee (Deputy Prime-ministers MS) Secretariat Court of the Community

Intergovernmental Council (Heads of State and Government)

Eurasian Development Bank (EDB)

The Evolvement of Eurasian Integration

In addition to the tasks mentioned above, it was also the regulatory body of the ECU and the SES, which highlights the interconnectedness of the different treaties and organizations (Eurasian Eco- nomic Commission, 2013). Because the Commission’s main task was coordination of the ECU and the SES, I will discuss these bodies in the next paragraph.

4.2.2 Policy Areas As stated above, the main function of the EurAsEC was to promote further integration and pave the way for the Single Economic Space and the Eurasian Customs Union. It thus had a clear economic agenda and roughly followed the same goals as the CIS in doing so. The EurAsEC failed to achieve an unrestricted free trade area and only 60% of tariffs were harmonized. Moreover, it did not suc- ceed in the creation of common agricultural and energy policies (Libman, 2011). The biggest suc- cess of the Community was paving the way for the establishment of the Eurasian Customs Union and the Single Economic Space.

4.3 Eurasian Customs Union (ECU) and the Single Economic Space (SES) Following the CIS, countries that wanted to go further with the economic cooperation began to con- sider new forms of integration. In 1995, the idea was launched to establish a customs union between Belarus, Kazakhstan and Russia, though no formal agreement was signed by these countries at the time. A year later the three ‘frontrunners’ of integration in the region, plus Kyrgyzstan, signed the Treaty on Increased Integration in the Economic and Humanitarian Fields (Eurasian Economic Commission, 2013). After Tajikistan joined in December 1998, the group became known as the ‘Big Five’ agreement. “At the beginning, this ‘union’ was nothing more than a pledge of the parties to observe the provisions of the CIS agreements that were already in place” (Zhalimbetova & Glea- son, 2001). With the IIEHF treaty, basic goals of integration were set up, such as the creation of common markets for goods, services, capitals, labour and developing single transport, energy and information systems (Eurasian Economic Commission, 2013).

A new step in the integration process was taken in 1999 when Belarus, Kazakhstan, Russia, Kyrgyzstan and Tajikistan signed the Treaty on the Customs Union (CU) and the Single Economic Space (SES) (also often referred to as Common Economic Space), which formalized the initiative taken in 1995. Though the SES was only partly established in 2003 with the exclusion of the Kyr- gyzstan and Tajikistan (Eurasian Economic Commission, 2013). The establishment of the Customs Union was seriously discussed during an informal summit in Sochi in 2006. It was decided that Be-

larus, Kazakhstan and Russia would step up efforts aimed at installing the CU. Kyrgyzstan and Ta- jikistan would join later after implementing more preparatory measures. Based on these arrange- ments the Treaty on the Establishment of the Common Customs Territory and Formation of the Customs Union between Belarus, Kazakhstan and Russia was signed in October 2007. By 2009, the integration stages and the timeline of creating the single customs area were defined. The ‘troika’ officially established the Eurasian Customs Union and the Single Economic Space on the 1st of Ja- nuary 2010, although it took two more years before the SES came into effect and was fully operati- onal.

The development of the ECU and the SES has been of crucial importance for the success of Eurasian regional integration, because it encompasses the vital processes of trade in goods and ser- vices, movement of labour, macroeconomic coordination, financial integration, common technical regulations, and regulatory convergence. Moreover, the ECU was the first major initiative that was actually implemented. It was following its written rules and actually developing as a proper institu- tion (Schenkkan, 2014). In relation to this, the Eurasian Economic Commission, as the regulatory body of the Eurasian Economic Community (see below) was the first truly supranational institution in the two decades of post-Soviet reintegration (Vinokurov, 2012).

4.3.1 ECU and SES Governance Structure As discussed in the previous paragraph on the EurAsEC, the regulatory bodies of the Community had been appointed to manage the SES and the ECU. The supreme body remained the Interstate Council of the EurAsEC (the Mezhgossovet), in addition, also referred to as the Supreme Eurasian

Economic Council (See figure 4.3). All of these bodies consisted out of the same persons, the heads

of state and government of the member states (the CHS and the CHG in the case of the CIS). Its functioning was basically the same as in the framework of the EurAsEC, it defined the strategy and objectives for further integration in the framework of the ECU and SES. Meetings took place on a yearly basis in which the overarching strategic plan was decided (Krotov, 2012, Blockmans, 2012).