Indonesia has requested to open negotiations for a Free Trade Agreement with the Eurasian Economic Union, Russian Foreign Minister Sergey Lavrov has said this week. Speaking in the follow-up to the negotiations with his Indonesian counterpart Retno Marsudi, Lavrov said that the proposal on creating an EAUE-Indonesia free trade zone is under consideration. “Indonesia shows interest in starting negotiations on creating a free trade zone with this union [EAEU]. The relevant proposal has been introduced and is now being considered. Russia backs it.”
Economy & Politics
What is the longest bridge in Europe? It’s a good trivial pursuit question, but not one most will be able to answer. In fact, its existence is partially down to Western sanctions on Russia following the decision to bring the Crimean Peninsula back into Russia. (Historians will know that apart from the period 1991-2014, Crimea was part of either the Soviet Union or Russia from 1783, and had previously been part of the Ottoman Empire along with Turkey, Bulgaria, and Romania before then).
Russian E-Commerce Up 22 Percent to Expected US$20 Billion in 2017 – Online Purchases from EU “Among Most Valuable”
Russia’s e-commerce market is growing at a rapid pace, and is indicative of a major shift in how Russians are purchasing products. “Domestic e-commerce expenditure hit 498 billion rubles (US$8.6 billion) in the first half of this year, a 22 percent increase year-on-year”, Russian Post and the Association of Internet Trade Companies (AITC) said in a joint statement on Tuesday.
AITC expects the market to exceed 1.1 trillion rubles (US$19.1 billion) by the end of 2017, while cross-border e-commerce trade increased 34 percent in the first half of 2017 year-on-year to 178 billion rubles (US$3 billion), meaning the share of cross-border tax free trade grew 35.7 percent in the first half of the year. Russian Post’s share of this accounted for 67.5 percent of the country’s online market in the first half of the year. “If cross-border trade keeps those growth rates it will squeeze out Russia’s online sales of small appliances and apparel within a couple of years,” AITC CEO Alexey Fedorov said in response to the results.
Cryptocurrencies backed by natural resources would be more trusted than ones backed by banks, Alexander Borodich, the founder of the Universa block-platform and a venture capital investor, has suggested at the Third Eastern Economic Forum (EEF) in Vladivostok.
Borodich said that as a country rich in natural resources, Russia is able to convert electricity to cryptocurrencies through mining, thus generating as much cryptocurrencies as possible to trade with on the market. “With the status of cryptocurrencies in Russia not yet clear even to the government, there are certainly some projects that are more or less related to cryptocurrency. Several mining companies have presented their solutions on mining cryptocurrencies. Actually, they are more about mining than cryptocurrencies,” he noted.
North Korea should be brought in from isolation and be economically rehabilitated into North East Asia, it has been suggested by Russian President Vladimir Putin at the Eastern Economic Forum, currently being held in Vladivostok. At the plenary session, the leaders of Russia, Japan, Mongolia, and South Korea discussed in an open forum the issues facing North East Asia. When it came to the situation involving North Korea’s nuclear program, Vladimir Putin called for a peaceful solution to raising tensions, and for North Korea to be involved in common economic cooperation. The leaders of Japan and South Korea put more emphasis on forceful measures against North Korea.
“There is some merit for this concept”, comments Chris Devonshire-Ellis, who served as Vice Chair of Business Development at the United Nations Greater Tumen Initiative at a time when North Korea was a member. “I personally believe that sanctions do not work, have not worked, and are making matters worse. It would be far more preferable for the DPRK to be gradually weaned off their isolationism, and be shown that the road to progress and peace is in fact via mutual trade. It is a policy that has been working very well in Central Asia, and should be returned to in the North East”
This year, Dezan Shira & Associates celebrates its 25th anniversary; I started the practice as a small, three person outfit, operating out of my bedroom in Shenzhen in November 1992. Just two and a half years prior to this, China had gone through the convulsions of the Tiananmen Square “incident”, where tanks had entered Beijing and faced down a student population demanding democratic rights. For a few days, the entire destiny of what is now modern China was in the balance. The Communist Party of China (CPC) ordered a crackdown on the unrest and the window for revolution passed. An initially uneasy, but then progressive peace returned. Today’s China is largely built on those few days, and it is worth – in historical context – to recall that the Soviet Union had collapsed just two years earlier. While many were supportive of the unfortunate, democratic wishing students, no one was ever able to suggest what the alternative to the CPC would be. China had teetered on the verge of splitting apart, and there have been provinces in China’s history that have at one time or another declared independence. China today would look very different had the CPC fallen in 1989.
“I am a supporter of cryptocurrencies, I think that there should be the Kryptoruble. But this is a complicated issue. At a working group on the blockchain we agreed that we would proceed with caution, but would not drag out the process.”
Shuvalov added that the Russian government, the Central Bank, and the Federal Security Service were working on the security implications of the introduction of this currency, and added that the advance of cryptocurrencies could not be stopped, but they had to be introduced in such a way that would boost the national economy rather than weaken it. Russian President Vladimir Putin said in late July he was “cautious” about the usage of cryptocurrencies since the area was not well regulated.
The member-states of the Eurasian Economic Union (EAEU) have endorsed Moldova’s application for observer status within the organization, Kyrgyz President Almazbek Atambayev said at the meeting of the Supreme Eurasian Economic Council on Friday.
“It has been decided to welcome and endorse Moldova’s application,” he said, adding that the decision on granting the country a new status “has been approved under the established procedure.” The Presidents of Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, and Russia are participating in the meeting of the Supreme Eurasian Economic Council in Bishkek.
The Eurasian Development Bank (EDB) is continuing projects initially led by foreign banks but currently suspended due to anti-Russia sanctions, Dmitry Pankin, the chairman of the EDB Management Board, said on Friday. Speaking on the sidelines of the Eurasian Week international forum in Astana, Pankin said that the EDB may take the opportunity to take up those projects that cannot be run by foreign banks. “The anti-Russian sanctions have two sides for us. There are factors that restrict work, and there are those that open up new opportunities and should be used,” Pankin said.
The Eurasian Economic Union (EAEU) has prioritized a Free Trade Agreement (FTA) with Singapore following “several ASEAN nations” approaching the EAEU for Free Trade Agreements at the Russia-ASEAN summit in Sochi last May. The Singapore deal may be concluded by the end of this year. The EAEU is a free trade bloc that includes Armenia, Belarus, Kazakhstan, Krygyzstan, and Russia. It essentially extends from the borders of China to the borders of the European Union.