World Economy

EEU Eyes FTZ With Asia-Pacific Countries

EEU Eyes FTZ With Asia-Pacific CountriesEEU Eyes FTZ With Asia-Pacific Countries

The Eurasian Economic Union (EEU) between Russia, Belarus and Kazakhstan may establish a free trade zone with the Asia-Pacific countries, Russian Prime Minister Dmitry Medvedev said.

“We (Eurasian Economic Union) are individually conducting talks on setting up a free trade zone, and the Socialist Republic of Vietnam has come the closest to agreeing on a deal,” Itar Tass quoted Medvedev as telling journalists on Thursday.

Medvedev specified that Russia and Vietnam “have agreed on almost all the issues. If this experience proves to be successful, Vietnam will get access to the common market of the Eurasian Economic Union, and we will be able to use this in regard to other Association of Southeast Asian Nations (ASEAN) states,” he said.

Medvedev stressed that Russia carefully studies the initiatives on integration associations in the Asia-Pacific Region, namely China-led Regional Comprehensive Economic Partnership (RCEP) and the Trans-Pacific Partnership (TPP) pushed by the US. “This does not mean that we will join them, but we are looking into what will result from this,” he said.

Many analysts see the ongoing negotiations on setting up the RCEP by ASEAN Plus Six group as Beijing’s counterweight to the US-led TPP of 12 countries throughout the Asia-Pacific region, which is designed to exclude China.

  Oil Prices

The Russian government will review budget parameters only if oil prices slump, Medvedev said in reply to reporters’ queries after the East Asia summit. “Indeed, a strong fall in oil prices may require a review of the fiscal policy’s main parameters but this will happen only in case a strong and steady fall,” he said.

The current level of oil prices cannot be a ground for talks to review the parameters of the country’s federal budget,” Medvedev said. “These fluctuations (currently at around $80 per barrel) are not a cause for review,” he said.

However, if oil prices continue to fall and this fall is sharp, Russia will have to revise the budget, Medvedev said, adding this was normal practice for all countries. “We must be realists,” the Russian premier said, adding the oil price plunge during the global economic crisis of 2008-2009 was more dramatic compared with the current level.