The price of Eurasian disintegration
- Disputes over the application by national customs services of sanitary, phytosanitary and veterinary measures, for example between Minsk and Moscow on dairy products or between Nursultan and Moscow on watermelons and chicken meat.
- Pretensions on certain exemptions from the common customs tariff of the EAEU for third countries, for example, for supported foreign cars and sugar imports.
- Complaints about unlawful restrictions on cargo transit, or, conversely, on the re-export of products, which are under the Russian import ban. Examples include Kazakh coal deliveries for Ukraine or “Belarusian” shrimp.
- What will happen, if tariff duties are introduced between the member states of the “former” EAEU, i.e. if the customs union dissolved would be dissolved and free trade in goods abandoned?
- What will happen if the common economic space is dissolved, i.e. if each “former” member state introduces its own and different from each other technical regulations and standards, sanitary, phytosanitary and veterinary measures, competition and subsidization rules, anti-dumping measures, requirements for licensing suppliers, etc.?
- What are the consequences of abandoning the common labor market and the free of movement of labor?
- Bilateral trade data from 2018 for the four parties (EAEU, EU, China and the “rest of the world”) aggregated for 24 MTN product sectors from the WITS (UN COMTRADE) For the bilateral trade flows CIF recorded imports were preferred. Country effects were estimated by applying the share of each member state in intra-Union trade.
- Aggregated simple most favored nation (MFN) ad-valorem import tariffs from 2018 were taken from (WTO 2019) and the WITS (UNCTAD TRAINS)
- The AVEs of NTMs for intra- and extra-EAEU trade were taken from (Knobel et al. 2019), for China from (Niu 2018), for the EU were taken from (Berden et al. 2015), for the rest of the world from (Niu et al. 2018).
- Import elasticities were taken from (Ghodsi et al. 2016). The export supply (1.5) and substitution (5) elasticities were taken as constants across all sectors and regions.
- A matrix of bilateral data on labor migration for 2017 for four parties (EAEU, Uzbekistan, Tajikistan and the rest of the world) taken from the (World Bank) database.
- A matrix of bilateral data on personal remittances for 2017 for the EAEU member states taken from the EEC Statistics Department.
- As the “ad valorem equivalents of barriers to labor migration”, the author interpreted the reverse value of the integration index on the EAEU labor market for 2011 and 2017, developed by the EEC Macroeconomic Policy Department. The ad valorem equivalent of barriers to labor migration within the EAEU is 41%, for the CIS countries outside the EAEU – 70%, for the rest of the countries – 95%.
- The elasticity of imports, taken from (Ghodsi et al. 2016) and (Tokarick 2010). The elasticity of export supply and substitution were taken as constant values in all regions.
|Scenario 1. No Eurasian customs union||Scenario 1+2. No single economic space||Scenario 3. No common labor market||Effects of scenarios 2 + 3 together|
|Intra-union trade change||Welfare change||Intra-union trade change||Welfare change||Intra-union labor migration change||Intra-union personal remittances change||Welfare change||Welfare change|
-USD 13 bln
-70 bln USD
|-1.8 percent||-50.3 percent||-USD 5.8 bln||-0.3 percent||-2.2 percent|
– USD 76 bln
|Welfare change||Welfare change||Personal remittances change||Welfare change||Welfare change|
|ARM||-1.1 percent||-6.2 percent||-USD 1.1 bln||-8.8 percent||-15.0 percent|
|BLR||-3.7 percent||-20.3 percent||-USD 0.5 bln||-0.8 percent||-21.1 percent|
|KAZ||-0.8 percent||-4.2 percent||-USD 0.6 bln||-0.3 percent||-4.6 percent|
|KGZ||-2.6 percent||-14.2 percent||-USD 1.7 bln||-20.8 percent||-35.0 percent|
|RUS||-0.1 percent||-0.6 percent||-USD 1.9 bln||-0.1 percent||-0.7 percent|