The results of the EEU Supreme Council’s Session

6 m.   |  2019-10-28

T he EEU Supreme Council’s Sessions in Yerevan stood out not only for the topics discussed, but also were unprecedented in the participating countries. Due to this it provided tangible results which were recorded on October 1. The event and the achievements from the session allow us to comprehend that Armenia’s chairmanship in the EEU in 2019 was fairly effective at least by fulfilling the priorities set by the union.

The international conference entitled “Transit potential of the Eurasian continent” took place in Armenia, the title and agenda of which proofed once again, that despite the lack of access to the sea, the current geographical location of Armenia has potential to be utilised to develop trade-economic links between the Union countries through a well-developed logistic and infrastructure system.

Armenia has always suffered economically because of an unfavorable geographical position. Actually, one of the counter arguments against Armenia’s membership to the EEU, was the absence of a common border with the member states. Now, when the EEU integration processes have expanded, a situation emerged, where Armenia’s current geographical position turns out to be very beneficial not only for further economic development, but can also play a decisive role in the other member states integration to the EEU. The common border between Armenia and Iran plays this role in the expanded integration and it turns out that for the first time in the history of independent Armenia, the geographical position of the country creates a broad platform for economic opportunities.

Talking about the integration process of the Islamic Republic of Iran to the EEU, we should first of all emphasize the friendly relations between Armenia and Iran and that Armenia has played an important role in the integration process of Iran into the EEU and will continue to with this directive. On one hand, if taking into account, that Iran has a land border with only Armenia out of all the EEU member states, it becomes obvious that Iran-EEU “economic train” should certainly pass through the territory of Armenia. If this initiative follows through the Armenian-Iranian cooperation moves to another level thanks to the agreement recently signed in Yerevan. The results will be noticed on October 27, when the interim trading agreement between the EEU and Iran will enter into force, providing greater opportunities for the EEU, and for all Armenian organizations to have a more simplified access to the Iranian market. It is important for the EEU and especially for Armenia to fulfill the trade agreement properly, as this simplified agreement is just the first step on the path to further trade-economic integration. Moreover, the speed and depth of further integration processes mainly depend on the successful course and results of the above mentioned facts. 

After the agreement entering into force, more than 300 products will be exempted from tariff adjustment restrictions, the tariffs will be reduced, which will later allow to export any type of product produced in the EEU, including Armenia to the Iranian market with less restrictions and bans. It refers to numerous agricultural products, grocery, species of fish and so on.

The prospect of “gas for electricity” project is also of particular importance, as the export of electricity from Armenia to Iran has increased by 67% for one year. Taking into account the international sanctions, Iranian interests within the EEU frameworks are also multi-polar. The enhanced cooperation in the fields of high-tech, scientific-technical and tourism is particularly expected to increase.

The next important direction on the conference’s agenda was the signing of the agreement on creating a free trade zone between the EEU and Singapore, in the implementation of which Armenia had also made a great contribution. The free trade zone agreement signed between the EEU and Singapore plans to apply 0% customs duty for 12 thousand and 229 products. It should also be stated, that in 2018, the EEU-Singapore trade turnover was $ 4.2 bil., which is 0.56% of the total trade turnover. It’s not surprising, that the Information and high-tech field is one of the main pillars of Singapore’s economic success. Considering that the development of this field is also a priority for Armenia, the cooperation is quite promising and contains serious development prospects.

Another new agreement with China will enter into force in October, which will facilitate trade procedures and will contribute to the realization of other projects, among which is the “One Belt, One Road” initiative. The document sets out mechanisms for enhancing the cooperation between the parties, and it also envisages to give consulting on creating information exchange centers between public and private organizations. 

Besides the issues on integration and cooperation of the third countries, there were also numerous issues related to the current processes of the Union on the session’s agenda. In particular, the conceptual issues on harmonization of the EEU member states legislation in the field of natural gas supply and transportation, as well as creating joint financial markets were discussed during the session. The latter will become a roadmap for banking and insurance services, development and approval of universal rules of stocks operations, the planned activities implementation of which will make the financial instruments affordable for the citizens of our countries within the Union.  A special attention was paid to the measures eliminating barriers to the free movement of labor, which will not only contribute to the creation of a single labor market but will further create favorable conditions for the introduction of a single pension system, equalization of different retirement ages as well for elimination of other barriers. It must be emphasized, that the policy agreed within the EEU should be improved and the process of decision-making should move in a more progressive pace.

To sum up, the realization of the agreements already reached are very important to form an agenda within the EEU integration process, with which the outcomes of international integration processes and economic cooperation will be more visible and tangible to all levels of the society. This will first of all occur through the strengthening of the production potential of Member States and through the development of cooperative potential and will contribute to the improvement of living conditions in member states. Also contributing to the increase in domestic and foreign market competitiveness and for withstanding the global challenges.