On 10.03.2020 the DOC held a research seminar together with UNU-CRIS to discuss the “Regional integration in Eurasia & the European Union: Exploring opportunities for collaboration”. The panelists included Fabienne Bossuyt, Cyn-Young Park, Mario Apostolov, and Behrooz Gharleghi. Below is a summary of the main arguments of the speakers.
Fabienne Bossuyt argued that, given the ongoing tensions between the European Union (EU) and Russia, only few experts will give serious thought to the prospect of trilateral cooperation on connectivity between the EU, China and Russia in Central Asia. However, as China further embarks on implementing its Belt and Road Initiative (BRI) and remains firmly set on pursuing the ambitious goal of connecting China overland with Europe, the EU and Russia – as indispensable stakeholders for this continental connection to successfully materialize – have been developing policy responses to China’s initiative that reveal an unexpected willingness to cooperate. Although the idea of trilateral cooperation may be too far-fetched for the time being, there is scope for cooperation between the three sides, be it more in the form of bilateral cooperation than trilateral cooperation. The EU even recognizes this formally. In the EU’s new strategy for Central Asia, which was released in May 2019, connectivity is identified as one of the areas where possible synergies with other external partners should be established. However, it remains to be seen how such synergies will be achieved in concrete terms, especially with Russia. For the time being, formal alignment between the EU and the Eurasian Economic Union seems off the table. Several opportunities for cooperation are emerging for the EU and China, as they have found a common language in the SDGs. By linking its cooperation commitment to the SDGs, China is converging towards the understanding that the EU has of connectivity and of international development, which has made the EU feel more comfortable about the possibility of cooperating with China on connectivity. Still, there remain several hurdles to cooperation due to the very different nature of China’s and the EU’s implementation methods and approaches. Therefore, in the short term, only indirect cooperation, namely in the form of co-financing between the EBRD and the AIIB seems likely.
Cyn-Young Park presented the results of the regional integration in Asia, Africa, Latin America, and the EU. Among the regions, EU showed a strong integration among others. Asia and Latin America occupied the second position. However ASEAN was performing better than the two latter regions. The integration result was an outcome of calculating various dimensions including regional value chain, trade, etc.
Mario Apostolov, Regional Adviser at the UN Economic Commission for Europe, spoke about the dynamic nature of regional integration which should be reflected in defining indicators of integration in Eurasia. Before measuring progress in integration in Eurasia, we must define what we measure – what is Eurasia, a region or regionalism? The regional structures in Eurasia differ in terms of drivers, levels and outcomes of integration, as well as political psychology. Defining indicators to put them in comparative perspective should aim at uncovering common features to help build harmonious relations in Eurasia. The challenge is to focus not only on easier to measure factors, such as trade, investments or migration, but also on intangible indicators. In terms of trade, we generally distinguish five levels of integration: preferential trade agreements; free trade areas; customs unions; common markets; and full economic/political unions. They are present throughout Eurasia, and on all steps of evolution of the European Union. The Eurasian Economic Union grows through the same stages, yet problems remain, such as the discrepancies between countries’ tariffs agreed at the WTO and the common external tariff of the Union, or trade deflection in Kyrgyzstan. In the final resort, we should go further. Mr. Apostolov believes that factors to consider also include: diminishing occurrence of economic and political conflicts; economic efficiency (aligning supply chains, trade, investment and production); development and integration of the knowledge economy (development of institutions for innovation, openness, ICT); data sharing; integrated labour markets; alignment of the objectives of elites and the population; shared political psychology; leadership factor as opposed to hegemonic influence by stronger actors; and assistance to laggards.
Behrooz Gharleghi discussed the new initiative at DOC research institute which aims to measure the level of connectivity among the Eurasian Economies. The initiative of Eurasia Integration Index has several dimensions including the monetary connectivity among others. He pointed out that the response of these economies to external shocks should converge over time to conclude in favour of further economic integration. He stressed that at this stage, the region of Eurasia seems to be divided; Central Asian countries are integrated with the Chinese economy while rest of the region is integrated with the global economy. Therefore a clear pattern cannot be concluded. However, additional analysis will be carried out to confirm these arguments.
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