The Customs Union between Belarus, Kazakhstan and Russia: and Overview of Economic Implicaitons for Belarus

The paper examines the economic implications of Belarus' participation in the newly created EURASEC Customs Union. The results of the calculations show that after the introduction of a common external tariff (CET) the level of tariff protection in Belarus has not increased noticeably. The reduction in the volume of imports from non-CIS countries equal to USD 1.1 bn (8% of Belarusian non-CIS import in 2008) will be mainly brought about by cancellation of used cars imports from non-member countries. The analyses revealed that Belarusian budget can benefit from participation in the Customs Union (CU). The amount of possible gain will be about 28.3% of total budget revenues from customs duties and customs charges in 2008 due to the fact that approximately 40% of Russian imports may go through customs clearance in Belarus owning to less bureaucracy at the border with respect to Russia, and the revenues from customs charges, which is not planned to be distributed among member countries, will be transferred to Belarusian budget. However, it is unlikely that CU membership will increase foreign direct investment (FDI) inflow to Belarus, since in the case of South-South regional trade agreements (the type of EURASEC countries CU) FDI usually goes to the bigger country, i.e. to the bigger market. Therefore, most probably that in the regional arrangement in question Russia followed by Kazakhstan will be the main beneficiaries of foreign direct investments.Customs Union, Import, MFN Tariff, Belarus, Kazakhstan, Russia

Russia’s Accession to the WTO: Impacts and Challenges

On December 16th, 2011, an 18 year long negotiation process regarding Russia’s WTO membership was finally brought to an end. Undoubtedly, Russia’s WTO accession is an important event both for the global trade system and for the country. With Russia now in the club, the WTO will control over 97 per cent of global trade.Russia, WTO, trade

Quantifying Economic Integration of the European Union and the Eurasian Economic Union: Methodological Approaches

Despite current political headwinds, there is need for a timely expert assessment of the comprehensive economic integration between the European Union (EU) and the emerging Eurasian Economic Union (EEU). This report constitutes a preliminary methodological study. It starts off by offering a general understanding of the possible scope and limits of EU-EEU economic integration. It surveys the available literature on the various impacts that may arise if regional trade and investment agreements come into force. The report examines the use of computable general equilibrium models for assessment of the economic impact of integration agreements. It also analyses econometric methods used to study regional integration; and it discusses the applicability and constraints of other methods used to evaluate the effects of regional commercial agreements. The report presents a brief analysis of the methodology of assessing the impact of lifting non-tariff barriers

Assessing the Impact of Non-Tariff Barriers in the EEU: Results of Enterprise Surveys

After the establishment of the Customs Union (CU) and the Single Economic Space (SES), Belarus, Kazakhstan and Russia have repeatedly stated the need to eliminate exemptions, limitations, and barriers to mutual trade in goods and services. This report represents the first stage of a study on the economic impact of reduction within the SES and the emerging Eurasian Economic Union (EEU) of non-tariff barriers (NTBs) to trade among Member States. It gives an overview of works on the definition and classification of NTBs, and the quantitative assessment and calculation of the economic effects of NTBs reduction. The report also presents the results of surveys and interviews with enterprises and companies of Belarus, Kazakhstan, and Russia that export goods and services to the markets of the CU and EEU. These surveys and interviews revealed respondents’ views on the NTBs they face when exporting to each of the partner states. They also obtained quantitative estimates of NTBs as a percentage of the value of exported goods, which made it possible to estimate the costs of each of the NTBs to the enterprises

Estimating the Economic Effects of Reducing Non-Tariff Barriers in the EEU

The report provides the first comprehensive assessment of the effects of non-tariff barriers on mutual trade in the EEU and gives recommendations as to how to remove them. It is based on a poll of 530 Russian, Kazakh and Belarusian exporters. In the research non-tariff barriers are divided into two groups. The first group includes non-tariff barriers such as sanitary and phytosanitary measures, technical barriers to trade, quotas, prohibitions, and quantitative controls. The second group comprises price and competition controls (the institute of “special importers,” sale restrictions, restrictions on public procurement, various subsidies). The second group of barriers is often referred to as “sand in the wheels,” because it hinders the movement of goods and in principle can be fully removed. The authors have come to a conclusion that this very group of barriers possesses a more negative influence on trade. Therefore, the main policy efforts should be directed at removing “sand in the wheels” of mutual trade