Eurasian Economic Union Discussing Free Trade Agreements with Indonesia & Mongolia
- Updates on potential deals with Israel, Egypt & Argentina
- 50 other nations seeking EAEU FTA
The Eurasian Economic Union (EAEU) is considering an opportunity of establishing free trade agreements with Indonesia and Mongolia, Deputy Foreign Minister of Russia Alexander Pankin has stated, saying that “Joint research groups have been formed to examine the feasibility of making free trade agreements with Indonesia and Mongolia.”
Comprehensive activities are implemented within the EAEU framework to broaden trade and economic ties with third countries and create preferential conditions for access to foreign markets,. The EAEU trade basket already includes free trade agreements with Vietnam, Singapore and Serbia and the temporary one with Iran; two non-preferential agreements with China are implemented. Pankin also revealed that draft free trade agreements with Israel and Egypt are at a high stage of readiness.
The most promising requests from the standpoint of the mutual economic efficiency are selected among more than fifty applications for the foreign trade zone received by the Eurasian Economic Commission, Pankin said. It is difficult to forecast the end of negotiations because of the pandemic, he noted. “Six rounds of negotiations were held with Israel: the last one in March 2020 in Jerusalem, actually just before state borders closing. Significant progress was achieved after three rounds (all of them were in 2019) with Egypt; the date of the next meeting is coordinated,” the diplomat said.
The question of liberalizing trade relations with Argentina is not in the agenda at present, Pankin said. “Cooperation down the EAEU line is implemented within the framework of memoranda earlier signed by the Eurasian Economic Commission with MERCOSUR, the Latin American economic system, and the bilateral sectoral document with the state secretariat of agricultural industry of the Argentina’s Ministry of Production and Trade,” he added.
EAEU includes Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia and sits in the geographic space between China and the EU. It has a GDP of US$5 trillion and a market of about 183 million.
Indonesia would be a major prize as an EAEU free trade partner. It is mineral-rich and has a population of about 270 million with a (PPP) GDP of US$3.5 trillion. Russian-Indonesian trade is about US$2 billion with Indonesia exporting about US$800 million to Russia. Indonesian imports from Russia include iron, steel, fertilizers, oil, cereals, salts, paper, aluminum, rubber and machinery.
Mongolia is a smaller player yet is also mineral-rich and a bridge between Russia and China. Bilateral trade is also about US$2 billion, with Russia exporting similar materials.
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Russia Briefing is written by Dezan Shira & Associates. The firm has 28 offices throughout Eurasia, including China, Russia, India, and the ASEAN nations, assisting foreign investors into the Eurasian region. Please contact Maria Kotova at email@example.com for Russian investment advisory or assistance with market intelligence, legal, tax and compliance issues throughout Asia.