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Russia, Kazakhstan, Belarus Keep Customs Union

RUSSIA - Russia is to maintain the Customs Union with Kazakhstan and Belarus according to Emily Balsamo from the Moscow Office of Bord Bia Irish Food Board.

The Customs Union of Kazakhstan, Belarus and Russia (CU) was formed with the goal of eliminating international tariffs between the three countries, creating a common economic space.

Complete fruition of the policies of the Customs Union of Kazakhstan, Belarus and Russia has occurred only within the past few months, finally creating a free trade area with a common external tariff.

Kyrgyzstan and Tajikistan are currently in talks with the supranational committee that heads the Customs Union with the intention of joining.

Ukraine has not joined to date due to apprehension of it impacting on their planned WTO accession.

This raises the question of reconciliation of this pre-existing common economic space with Russias WTO membership in the near future.

Belarus and Kazakhstan are currently observer governments to the WTO, not members, and are thus not subject to WTO imposed trade liberalization. Also, how will Russia implement WTO policies while continuing to be a part of a common economic space with two countries that are not members of the WTO?

Russia will fully accede to the WTO later this month after the ratification of all relevant documents by the Russian government, parliament and president. Although tariff rates under WTO membership have not yet been released, it is widely understood that membership will greatly facilitate trade and importation to Russia.

The Customs Union of Kazakhstan, Belarus and Russia will continue through Russias WTO accession, likely leading to facilitation of importation to Kazakhstan and Belarus as well. In fact, Russias accession has incited strong interest in Belarus and Kazakhstans future accession, with Russia formally encouraging the EU to support accession of the two countries.

Valery Yazev of the Russian Dumas Economic Commission stated the following view: "In all likelihood, the Russian Parliament will ratify the corresponding agreement on July 23rd, as planned. Kazakhstan has begun accession talks. Belarus may find it more challenging though. But since the EU has been recognized by the WTO as its integration project that meets all WTO requirements, all WTO regulations will be applicable to Belarus as a member of the single economic space and the Customs Union.

Chris Haris

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