Kazakhstan and Eurasian Economic Integration: Quick Start, Mixed Results and Uncertain Future

Summary:

Kazakhstan's economic integration with Russia and Belarus has been advancing at break-neck speed. In October 2007, these countries signed a treaty on the creation of the Customs Union (CU), in July 2010 the unified Customs Code went into effect, and in July 2011 customs controls were removed from the borders between member-states. In January 2012, Moscow, Astana and Minsk introduced the Single Economic Space (SES) based on “freedoms” of movement of goods, services, capital and labor to be implemented by 2015.

While a union with Russia has been always an official priority, other trade integration alternatives have been pursued by the Kazakhstani government as well. The one that was in strong competition with the CU option was the prospect of joining the WTO and this way advancing Kazakhstan's integration with global markets and making the country's economy more competitive.

The analysis of the possible motives (economic, political and geopolitical) explaining why Kazakhstani leadership privileged integration with Russia over joining the WTO shows that economic reasons emphasized in the official discourse did not play the main role. Political reasons (primarily, the concern with security) seem to have been more prominent.

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