The Rise of the Other EU

3 years ago ccwa 0

0529_putin_eurasian_970The European Union has received a great deal of attention in recent years, partially due to the financial crisis, but also because of its opposition to Russian revanchism. In the background, Vladimir Putin has been quietly forming his own EU. The Eurasian Economic Commission, which is also being called the Eurasian Union, is a nascent economic union between Russia, Belarus and Kazakhstan, though other states, such as Armenia, Kyrgyzstan and prior to the recent revolution, Ukraine, were also dubbed for potential membership. This union, in many ways modeled after the EU, would create an integrated economy among member states that would lower import and export tariffs and potentially allow free movement of citizens while also introducing universal currency among member countries. It is no small point that Russian Prime Minister Dmitri Medvedev has already called for a single currency shared between Russia, Kazakhstan and Belarus. Political ties similar to those discussed within the European Union are also being deliberated amongst Eurasian Union members.

The Eurasian Union is itself an outgrowth of previous institutions, particularly the Commonwealth of Independent States, an organization of former Soviet Republics created for the purpose of forming common economic space grounded on free movement of goods, services, labor force, and capital. The Eurasian Union would go farther, and is seen by many observers as an attempt by Putin (who is the principal proponent and actuator of the agreement) to slowly resurrect the Soviet Union. Not only that, but more formal economic relations would eventually draw member states closer into Russia’s sphere and, as a result, act as a counterbalance to the European Union and the larger Western world. Considering how many in Russia view the European Union’s spread eastward, (Belarus, Moldova and Ukraine are the only states in eastern Europe that are not members) as well as NATO with suspicion, it is not surprising that Moscow is trying to bring nonaligned states closer into its sphere.

Various problems are apparent with the make-up of the Eurasian Union, both politically and economically. Politically, many potential members of the Eurasian Union fear Russian domination, especially after Putin’s interventions in Ukraine, which would have been a centerpiece of the union had it signed on. Not only would Russia be the only foreseeable nuclear power in the union, but its military power, influence and GDP would vastly outstrip every other potential member – even combined. Add that to Putin’s repeated aggressive actions since Ukraine’s ousting of former President Yanukovych, and it is not surprising that other potential Eurasian Union members are weary of creating closer ties with Russia. In Kazakhstan for example, many lawmakers see no need for agreements that would also bring about a political union between Eurasian Union members. Kazakh politician Azat Peruashev has gone so far as to say that a political union would go against his country’s national interests. Others are more open to the idea, albeit with a great deal of caution.

Putin has also had troubles bending other states to his will. For example, Ukraine, which was a centerpiece of the plan as well as the second largest potential economy after the Russian Federation, has explicitly stated that such a union is impossible even before the revolution earlier this year. Furthermore, Belarus has refused to engage in a trade war with Ukraine despite pressure from the Kremlin. Spurred by Ukraine’s acquiescence of an association agreement with the European Union, Russia has instituted protectionist economic sanctions against Ukraine, which Belarus has refused to follow.

Russia is also poised to dominate the Eurasian Union economically. It’s economy, while only the 8th largest in the world, will constitute 88.5% of the union’s GPD. Despite this, however, the Eurasian Union is not expected to be anywhere near as economically powerful as the European Union or even China, which border the Eurasian Union geographically. Furthermore, the Customs Union, a forerunner of the Eurasian Union economic union has only significantly helped the Belorussian economy. By comparison, Russian trade grew a meager .5%. Furthermore, as the largest economy, Russia will have to bear the majority of the costs of regulation and integration, which might lead to a free rider problem with its other members. Add to the equation that potential members only make up 7% of Russia’s foreign trade, and it may not be too much of a stretch to say that Russia is paying other states to be its friend at great economic cost to itself.

Despite these setbacks and hurdles for the Eurasian Union, it nonetheless hints at potential problems between Eastern Europe and the West should it come into fruition. Russia, situated on the fringe of European culture, has historically been torn between European and Slavic culture. Moscow’s attempts to build a rival trade organization illustrates that Russia is turning its back on the West once again and impeding its influence in the region. But more worrying is that Russia is embracing Eurasianism, an idea that originally began in the days following the October Revolution and has regained traction following the collapse of the USSR. Eurasianism holds that Eastern European and Central Asian peoples are distinct from the West and should pursue their destiny independently. Alone, this ideology would be likely be similar to other nationalist movements. More disturbingly however, Aleksandr Dugin, a prominent and radical Eurasianist and critic of the West’s ‘decadent lifestyle’ has earned the ears of many close to Putin. For example, he praised the uprising in Ukraine as the “liberation of Europe from the very Atlanticist occupiers who caused the catastrophe in Kiev.” For his part, Putin has shown a pattern of opposing what he sees as Western encroachment against Eurasian peoples. It’s not a coincidence that Putin’s reasons for intervening in Ukraine are ostensibly to ‘protect ethnic Russians.’ The creation of the Eurasian Union appears to be another outgrowth of the weariness that Russia, and Putin in particular, have towards the West. As it stands now, Eurasianism and the EU appear to have the potential to breed more problems in the future, not only for West, but also for the world as a whole. Given the horrible extremes to which nationalist movements have been willing to go in the past, it can only be hoped  that the Eurasian Union does not follow the same path.

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by Joe Staff

(photo credit: businessweek.com, valdaiclub.com)