Cambodia, Indonesia, Philippines & Thailand All Candidates For Eurasian Economic Union Free Trade
Dmitry Medvedev, the Russian Prime Minister, has been attending the 14th East Asia Summit as a guest in Bangkok this past few days and has confirmed that Brunei, Indonesia, Cambodia, Thailand and the Philippines have all expressed interest in signing free trade agreements with the Eurasian Economic Union (EAEU).
“The Eurasian Economic Union has experience in creating a common market and I would like to point out that the Union is open to cooperation with all interested partners,” he said. “We welcome the interest that Brunei, Indonesia, Cambodia, Thailand and the Philippines have shown,” Medvedev added.
He noted that free trade agreements had already been signed with Vietnam, Singapore and China, and that talks were currently underway with India.
The Russian prime minister emphasized the need to combine the potential of ASEAN, EAEU countries and the Shanghai Cooperation Organization (SCO).
Russian trade with ASEAN has been patchy, however the recent experience of an EAEU FTA with Vietnam has been positive. Vietnam has received about US$10 billion in Russian FDI into the country in the past two years, and other Russian manufacturers such as GAZ trucks are currently looking at establishing Joint Venture manufacturing operations there, producing vehicles for both local and pan-ASEAN markets.
Singapore signed off a FTA with the Eurasian Economic Union last month, while the prospects of India doing the same have probably increased following that countries decision not to sign off a deal with the pan-Asian Regional Comprehensive Economic Partnership (RCEP).
The Eurasian Economic Union includes Russia along with Armenia, Belarus, Kazakhstan and Kyrgyzstan and occupies the land mass between China and the European Union.
A Free Trade Agreement with the EAEU offers ASEAN members the ability to receive Russian foreign direct investment, employment and trade as Russian investors in particular are keen to establish markets in Asia following sanctions placed upon them by the United States and EU. ASEAN members also get access to the EAEU market, which has a GDP of US$1.9 trillion and a population of 180 million. Differing climatic conditions mean that EAEU consumers are in the market for agricultural products such as fruit, while ASEAN is a major market for cereals and grains. Meanwhile both Russia and ASEAN nations are also jointly developing other products such as automotive, electronics and aviation industries where Russia has significant experience.
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Russia Briefing is written by Dezan Shira & Associates. The practice assists foreign investors, including Russian manufacturers and traders into Asia and has 26 offices throughout ASEAN, China and India. For assistance in ASEAN please contact Richelle Tay or Maria Kotova at ASEAN@dezshira.com or visit us at www.dezshira.com