Putin’s Eurasian Union: Just another Union?

A new project for regional integration has been brought to life in the post-Soviet space at such a rapid pace that Jacques Delors and the founding fathers of the European Union would go green with envy. Since January 2010, Kazakhstan, Belarus and Russia have adopted a common customs tariff, eliminated their border controls, launched a single economic space and signed an agreement to establish a fully-fledged economic union by 1 January 2015. Yet the Eurasian Customs Union (ECU) and its envisaged development into a political and economic Eurasian Union (EAU) is met with scepticism in the West. (1) In the past, Russia has too often made bold announcements and set ambitious timetables for economic cooperation projects which in the end all failed due to a lack of commitment.

This could turn out to be a dangerous underestimation. The ECU is on a qualitatively different level than previous integration projects. It is explicitly modelled on the EU and has a strong institutional framework which includes a governing commission, directly binding legal agreements, and a court to enforce these. In line with WTO as well as EU norms and regulations, the ECU is designated to become a new economic power centre and counterpart to the European Union. Although only wishful thinking for the time being, the economic and political challenges the ECU/EAU could pose in the future should be taken seriously. The envisaged accession of Kyrgyzstan and Tajikistan might not scare anyone in Brussels, but the battleground lies in Europe’s neighbourhood: Ukraine, second-largest country in Europe and strategically important transit land, is the EU’s child of sorrow–and Putin’s object of desire.(2)

From a Russian perspective, Ukraine is the key to the ECU’s political relevance and economic clout. Although President Yanukovych repeatedly assured that ‘Ukraine’s future is with the European Union’ (3) EU-Ukraine relations are at a new low-point. The negotiations about a Free Trade Agreement (DCFTA) are stuck in a deadlock due the imprisonment of former premier Yulia Tymoshenko and the resulting European boycott of the Euro 2012 football championship. Meanwhile, Russia seems to be exploiting the situation to its advantage and uses all available instruments–from carrots (cheaper gas) to sticks (trade sanctions)–to persuade Ukraine that membership in the ECU is economically and politically advantageous. As Putin put it: ‘Ukraine is not going to be allowed onto the European market, but we do allow them onto ours‘(4) –and most importantly, without constraining human rights or rule of law conditions. Yanukovych still seems to be committed to the free trade agreement as he fears Russian dominance over Ukraine’s economy. However, since external economic relations with the IMF are also stuck in an impasse, it could be only a question of time (and Russian money) until Ukraine approaches the ECU.

For the first time, the European Union has to compete with a similar regional integration project which claims to be a better EU, without ‘unnecessary bureaucratic superstructures‘(5). This raises questions about the viability of the EU’s strategy in the region. The EU’s Eastern Partnership programme seeks cooperation, but does not offer a membership perspective for the signatory countries (not to speak about the general enlargement fatigue in Europe). In other words, the incentives are low, while the hurdles and requirements for all forms of cooperation remain high. In fact, it was the Eastern Partnership programme which at first alarmed–and then inspired–Moscow. The EU’s power of attraction is certainly much stronger than Russia’s (not everyone voluntarily wants to come home to its former imperial power) but the ECU is capitalising on the general sentiment in Ukraine and other countries that ‘Europe has turned us down‘(6).

How far is the Eurasian Union a 21st-century version of the Soviet Union? The ECU is without doubt more politically than economically motivated–some scholars even argue that Russia loses out in economic terms.(7) Dmitry Suslov, Deputy Director for Research at the Council on Foreign and Defense Policy in Moscow, also emphasises that the term ‘Union’ is of utmost significance since it symbolically harkens back to the Soviet Union. ‘Eurasia’ is also a favourite concept of many influential Russian nationalists such as Aleksandr Dugin, aiming at re-establishing Russia as imperial centre in the region. These symbolic concepts indicate that the ECU is indeed a re-integration project but based on a modern EU-style rule-based system of governance rather than a past-oriented Soviet-style model. However, the final objective remains the same, namely to prove Russia’s Great Power status and to make it the centre of ‘one of the poles in the modern world’(8). The Eurasian Union is surely Russia’s most ambitious political programme since the end of the Soviet Union. As Putin’s own brainchild, it is likely to become one of the top priorities of his upcoming presidency.

Last but not least, if the Eurasian Union project proves to be viable, it could have an interesting impact on Russia’s state model. Since its creation, the European Union has observed the ‘Europeanisation’ of its member states which has included the development of a ‘coordination reflex’ in many policy areas, making the EU a post-modern model of (partly) supranational governance. Although Russia will certainly claim a dominant position within the ECU (primus inter pares is understated), a commitment to rule-based governance can lead to interesting shifts in Russia’s traditional 19th century nation-state concept. All in all, the Eurasian Union is still a prototype, but one of the most interesting and promising regional developments to look out for.

This post was co-edited by Claire Georges.

(1) http://www.dw.de/dw/article/0,,15615047,00.html, accessed 6 May 2012.
(2) http://www.time.com/time/world/article/0,8599,1900838,00.html, accessed 6 May 2012.
(3) http://online.wsj.com/article/SB10001424053111903461304576524672209158138.html, accessed 6 May 2012.
(4) http://premier.gov.ru/eng/events/news/16653/, accessed 6 May 2012.
(5) http://premier.gov.ru/eng/events/news/16622/?64014540, accessed 6 May 2012.
(6) http://ukrainianweek.com/World/44868, accessed 6 May 2012.
(7) http://valdaiclub.com/near_abroad/41060.html, accessed 6 May 2012.
(8) http://premier.gov.ru/eng/events/news/16622/?64014540, accessed 6 May 2012.