Any type of organization in which countries have agreed to coordinate their trade and monetary policies with other countries is called economic integration. Obviously, there are many different degrees of integration.
- Preferential Trade Agreement (PTA). The PTA agreement is perhaps the most basic form of economic integration. PTA typically offers tariff reductions for partners in certain product categories.
- Free Trade Area (FTA). It is created when a group of countries eliminates tariffs among themselves, but maintains an external tariff on imports from other states. An example of the creation of an FTA is the NAFTA agreement, which implies zero tariffs in automobile imports between the United States and Mexico. However, for member countries that are not part of NAFTA, there are other established tariffs for automobile imports in Mexico.
- Customs Union. It consists in the case when a group of countries eliminates tariffs between their states, but sets a common tariff for imports from the rest of the world.
- United Economic Union. The single market provides for trading at optimal tariffs, sets general external tariffs among members, and also creates advantages for the free movement of monetary funds between countries. The European Union was created as a single common market under the 1975 Rome Treaty.
- Economic Union. Economic unions of countries, as a rule, support the free trade in goods, establish common external tariffs between members, and determine the conditions for free cash movement of capital. The European Union's Common Agricultural Policy (CAP) is an example of the type of financial coordination of the indicative economic community.
- Monetary Union. The key to creating a common currency among a group of countries is the Monetary Union, which includes the formation of the main financial authority that determines the monetary policy for the entire group.
The beginning of the EurAsEC path
The Eurasian Economic Union is an international organization based on regional economic integration and an international organization. This means that the decisions of its bodies (the Eurasian Economic Council, the Economic Commission and the Economic Court) become the norms of international law.
The territory of the Eurasian Union (EurAsEC) covers more than 20 million km 2 (15% of the Earth’s land), a population of 183 million people live within the community.
The Treaty on the Eurasian Economic Union provides for the coordination of agriculture, industry, and energy; general sanitary and technical standards. By creating commonwealths of economic organizations, it is planned to create a common market for pharmaceuticals by 2016, by 2019 it is expected that the formation of a common energy market will be completed, and by 2025 - the market for oil, gas, and petroleum products.
History remembers examples of the reorganization of international economic organizations into political or even military alliances, a good example of this is the economic community of West African states. Not much time has passed since its inception, as its focus has shifted from commercial projects to military operations within the borders of commonwealth countries.
Friendship of peoples above all!
December 22, 2014 was marked by the exchange of instruments of ratification of good-neighborly and allied relations between Russia and Kazakhstan. The Treaty on the Eurasian Economic Union does not cancel the previous treaty on economic and political cooperation, signed between the countries in 1992, on the contrary, it supplements and expands the scope of interaction and allows the implementation of both plans in parallel to each other.
The organization is open to any state that is ready to share the goals and conditions stipulated in the contract between the states. At the end of 2014, Armenia and Kyrgyzstan also joined the Union.
It is worth noting that President Putin paid a business visit to Uzbekistan, where the conditions for the country's accession to the Eurasian Union were discussed. The speaker of the Federal Assembly of Russia said that consultations are being held on the possible entry of Tajikistan into the Eurasian Economic Union.
The reason for the emergence of the EurAsEC TS
The EurAsEC Customs Union (CU) entered into full force in January 2010 as the Customs Union of Belarus, Kazakhstan and Russia, a bit later Armenia and Kyrgyzstan joined it.
The Customs Economic Union was formed as the beginning of the economic union of the republics formerly part of the USSR. Thus, member states continue the path of economic integration by removing customs borders between themselves. At the end of 2014, the Eurasian Economic Union was created on the basis of the CU, which represents a common currency space to encourage further economic integration.
EurAsEC CU Member States: Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia.
Documents signed in 1995, 1999 and 2007 serve to regulate and protect the Customs Union with regulatory rights. The common economic space is called to control the 2007 document, the first regulates the creation of the Customs Union, and the second regulates its formation.
CU Regulation
Technical regulations, the approval of which is the basis for entry into the TS:
- National product certificates.
- Certificates of the Customs Union issued in accordance with the document, which indicates the list of products subject to mandatory confirmation of compliance. This certificate is valid in all countries of the CU.
- The growth rate of foreign trade and mutual trade of vehicles. The single customs code is regulated by the Eurasian Economic Commission and the Department of Statistics.
Economic unions often seek to import and export only those goods that are profitable in a particular economic zone. An example of this is the vehicle. Only goods that qualify as “TS goods” can be freely imported / exported within the established territory. In accordance with article 4 of the Customs Code, goods acquire this status in the following cases:
- Products released within the vehicle.
- Products, goods released for domestic consumption with payment of customs duties prescribed in the contract.
- Products that meet both conditions: manufactured within the boundaries of the CU for domestic consumption.
Products that do not meet the criteria for the goods of the vehicle, for which no relevant documents were presented in order to determine the purpose of the goods of the vehicle, must undergo the procedure of a single customs duty within the boundaries of the vehicle.
Other economic unions of Russia
- APEC. Economic Cooperation (APEC) was created in 1989 to unite the countries of the Asia-Pacific region. APEC is a forum for 21 states. The goal of the community has long been the establishment of markets for products, raw materials and materials outside of Europe. Experts believe that AEC was created in response to the growing economy of industrialized Japan, which has the power to dominate the Asia-Pacific region. However, strategically, the community is important primarily for the states that make up it, since it helps coordinate economic activity between interdependent countries.
- CIS. Interaction between some countries of the former USSR on the basis of sovereign equality is based on an agreement of the Commonwealth of Independent States (CIS). At present, the CIS includes the following countries: Azerbaijan, Armenia, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Uzbekistan and Ukraine. The agreement was signed in 1991.
- BRICS. BRICS unites 5 major emerging economies of the following countries: Brazil, Russia, India, China and South Africa. Prior to being incorporated into South Africa, the organization was called BRIC. All the member countries have a fast-growing economy and have a significant impact on regional and global changes.
At the end of 2014, BRICS coverage extends to 3 billion people, which is 40% of the world's population.
The Commonwealth was founded in 2006 as part of the St. Petersburg Forum of Ministers of Economics of Brazil, the Russian Federation, India and China. The first meeting was held in 2009 in Yekaterinburg. At meetings, issues of mutual partnership, the provision of loans, the natural environment and the environment are discussed.
On the path of the Maastricht Treaty
The European Economic Union (EU) is an economic and political federation consisting of twenty-seven member countries that have common policies in several areas. The EU was created in 1993 with the signing of the Treaty on the European Union, which is usually called the Maastricht Treaty. However, this was preceded by the creation of several European organizations that contributed to the development of the EU.
The EU initially consisted of 12 states: Denmark, Germany, Greece, Italy, Luxembourg, the Netherlands, Belgium, Portugal, Ireland, France, Spain and the United Kingdom. In 1993, the European Council, meeting in Copenhagen (Denmark), determined the criteria for EU accession. These requirements, known as the Copenhagen criteria, include basics such as:
- stable democracy that respects human rights and the rule of law;
- functioning market competitive economy;
- assuming obligations arising from membership, including EU law.
EU development after 1993
The EU has grown 3 times since its inception. In 1995, 3 new members joined: Austria, Finland and Sweden. In 2004, 10 new members joined the EU, mainly from the former Soviet bloc: the Czech Republic, Cyprus, Estonia, Latvia, Lithuania, Malta, Poland, Hungary, Slovakia and Slovenia. In 2007, Romania and Bulgaria, which did not meet the entry criteria in 2004, were admitted and admitted to the Union. In 2013, the list was replenished by the state of Croatia.
One of the goals of the EU is the economic and monetary union, which implies the creation of a common European currency. International trade within the borders of the common currency zone will greatly contribute to the creation of a single market, complete with uniform pricing and regulation of national markets. The creation of a single market can stimulate increased competition among niche products and facilitate relations of corporate financing, in particular, international trade between members of a single currency space. Finally, in the long run, the creation of a common trading and monetary space should simplify European corporate structures for the regulation of all regulatory acts to homogeneous ones.
Euro
Economic unions often aim to unite the economies of their member countries. Optimal management of economic activity in one currency zone can be achieved by introducing a single currency; such convergence will create greater uniformity between different national economies. The conditions established for the introduction of the euro and the creation of a single currency:
- Maintaining the international exchange rate within a given range (exchange rate mechanism or ERM) for a period of at least two years before the introduction of the euro.
- Maintaining long-term interest rates.
- Control of public debt within the established limits.
- Maintaining total public debt at the level of not more than 60% of gross domestic product.
EU structure
The European Economic Union includes 4 administrative bodies that deal with specific areas of economic and political activity.
1. The Council of Ministers. It consists, as a rule, of representatives of the ministries of foreign affairs of the EU member states. The Council of Ministers of Europe has the right of final decision on all issues that do not fall under the terms of the fixed agreements created in the EU or its previous organization. The Council of Ministers approves the Committee of Observers, resolves issues related to relations between EU countries in the following areas: governance, agriculture, fisheries, industrial policy and the domestic market, research, energy, transport, and ecology.
2. The European Commission. Economic unions of states, as a rule, form expert bodies to resolve financial issues. The European Commission acts as such an executive organization of the EU. It seeks to serve the interests of Europe as a whole in matters of external relations, economics, finance, industry and agricultural policy.
3. The European Parliament. Includes representatives of EU member states who are elected by direct vote in their countries. Although it serves as a forum for discussion of issues of interest to individual Member States and the EU as a whole, the European Parliament does not have any power to create or implement legislation. However, it has some control over the EU budget and can make matters for consideration by the Council of Ministers or the European Commission.
4. The court. Any economic unions must have a legal basis, the EU is no exception. The court consists of 13 judges and 6 lawyers representing EU Member States. Its function is to interpret laws and regulations, the decisions made are binding on the EU, the governments of member states, firms and individuals in the EU member states.
