The Eurasian Economic Union, in its’ present situation—comprising of Russia, Armenia, Belarus, Kyrgyzstan and Kazakhstan—is a functionally operating entity which aims to enhance cooperation and inter-regional development in a way which facilitates economic mobility through trade. The EAEU’s primary instrument of economic integration rests in the operability of its’ customs union which acts as an exclusive territory; encouraging synergistic cooperation between member states.
The infrastructural scaffold of the EAEU’s customs union has, embedded within it, strategic measures designed to provide for an environment of harmonised policies and interests that allowed the emergence of a unified, common market—instituting such economic modalities as the common customs tariff. This undergirding, supportive infrastructure catalysed exponential economic progress in the region, as evidenced by its’ consistent growth from 2017, having achieved ‘$73.1 billion dollars in 2021’, an increase of ’33.6%’ with regard to mutual trade.
It is crucial to highlight, however, the evident structural susceptibility of the EAEU to geopolitical externalities and internal disputations and contestations which may result in volatile economic, political episodes—potentially causing temporary rifts between member states. The imposition of sanctions on Russia in 2021 instigated by the European Union impacted the flow of crucial commodities such as petroleum, inadvertently inhibiting Armenian import share from the EAEU —drawing concern from Armenian authorities. The culmination of internal disagreements between member states within the union have also contributed to the rise of controversies which threaten to weaken EAEU’s regional relationships, with such issues as the reoccurring perspectives of Russia’s vulnerability to western sanctions and the policies over worker remittances, non-tariff and duties of the customs union disproportionately benefiting some member states over others—establishing dynamic inequalities—as being an obstacle to EAEU integration in the customs union being perceived as a undesirable, constituting a growing weakness of much needed incentive structures
Despite its’ institutional strengths, ASEAN has experienced intense economic catastrophes which chastised and limited the flow of economic capital. As a result of the Covid-19 pandemic which disrupted supply chains which have inhibited the degree to which efficaciousness of its’ intricate and developed free trade mechanisms preserved the health of the ASEAN economies. The seismic vulnerabilities within ASEAN as a consequence of external geopolitical and external forces limits the maturation of the region’s economic consciousness, and reveals the potential for these issues experience to morph into a period of deterioration that threaten the integrity of ASEAN institutions. It has been argued that ASEAN’s absence of needed incentive structures, in key areas of cooperation, has precipitated the lack of ‘political will’ in some instances among member states to effectuate coordinated policy responses to tackle regional dilemmas.
Both ASEAN and the EAEU experience pressures exerted by internal and external influences which advances adverse impact on economic growth and requires an enhancement of policy instruments that establish stronger internal incentive structures that promote a cohesion and cooperation.
What this arguably necessitates therefore is a galvanization of ASEAN-EAEU relations which result in a ‘shared’ cooperative space that encourages and incentivizes internal cooperation, one that provides for an opportunity to benefit for better protected economic opportunities.
There ought to be cooperation towards the establishment of an exclusive, transnational economic space facilitating trade between the EAEU-ASEAN which aims to develop established regional ecosystem in which the productive capacities of member states (in their respective unions) are utilised, catalysing integration.
The rationale for the first phase, as part of the action plan, is the utility in establishing a unique, economic space which is capable of functioning despite the influence of global power structures and externalities. This will allow for the leveraging of the productive capacities of the member states within the respective unions in a way that supplementarily accounts for the deficiencies in resources experienced, creating avenues for economic diversification. Access to a wider, exclusive market serves as a stronger impetus for the individual member states to participate in the integration within the respective unions, providing for a source of economic and political unity —strengthening the presence of incentive structures that motivate and drive regional connectivity.
The subsequent rationale for the second phase is to initiate a long-term strategy in which cooperation between the respective unions are further incentivized through the development of the exclusive, transnational economic space in a way that transforms member states of the respective unions to create a cohesive interconnected ecosystem between the distinct regions that allows for regional mobility and free trade.
The trading relationship between the EAEU-ASEAN provides for the infrastructure necessary to scale trade and to forge long-term partnerships. The action plan, in question, advances strategic measures to promote regional integration through external integration by facilitating the alignment of geopolitical and economic interests—promoting external cooperation through inter-union synergies to achieve internal integration between member states.
By Pravin Periasamy Networking and Partnerships Director at Malaysian Philosophy Society
