Russia, EU discussing liberalization of economic ties, impact of Customs Union

EU Map

(Interfax – December 19, 2012) The differences between Russia and the European Union in negotiations on a new basic agreement are not insurmountable, Russian Ambassador to the EU Vladimir Chizhov told Russian reporters in Brussels.

“The EU, and it is not hiding this, would like to go further in relations with Russia than the package of conditions on which Russia joined the WTO, so that it would be a ‘WTO plus,'” Chizhov said ahead of the Russia-EU summit on December 20-21.

He said there is logic in such a position, but it does not take into account the situation in the Russian economy. “The Russian economic, roughly speaking, is still digesting WTO membership,” Chizhov said.

He said Russia’s negotiations with the WTO ended with “a compromise that included serious concessions” on both sides.

“Yes, we are taking on these costs consciously, based on the fact that without integrating into the global economic system, Russia, as the last major economy in the world remaining outside the WTO, would in future face even more serious problems,” Chizhov said, adding that adopting WTO rules “requires some fitting.”

“Therefore, we are probably simply not ready yet to make some kind of further leap in the direction of liberalizing our economic ties. And we want our partners in the EU to soberly appreciate and understand this,” the ambassador said.

He said that the second important aspect in the negotiations is the process of Eurasian integration. While slow negotiations were being held with the EU, “on a parallel track, in Eurasian integration, there has been a genuine leap forward,” Chizhov said.

He said the EU has no reason to oppose this process and recalled that during her visit to Kazakhstan at the end of November European Commission Vice President Catherine Ashton said she welcomes Eurasian integration.

Chizhov said EU officials praise the Customs Union of Russia, Belarus and Kazakhstan, but stress that there should be two conditions: “that this should all be voluntary and that all participants should be members of the WTO.”

While on the first point there are no problems, as far as the second goes, “neither Kazakhstan nor Belarus are currently members of the WTO,” and while for Kazakhstan membership could be a matter of months the situation with Belarus is more complicated, Chizhov said.

Belarus has “formally begun negotiations on joining the WTO, but not made progress. Not by choice. And this is an issue that directly concerns the EU, considering the well-known EU sanctions against Belarus,” Chizhov said, calling on the EU to “help them join this organization.”
He also said that on some aspects of the future basic agreement with the EU, Russia no longer has the right to enter into legally binding agreements without consulting its partners in the Customs Union.

“Ultimately, we are coming to a certain understanding with the EU on involving the Eurasian Economic Commission in the negotiation process. Not as parties in the negotiations, but under a different arrangement, but generally there are things to work on here,” Chizhov said.