Journal № 1 (15) 2022
– Mr. Myasnikovich, 2021 was a difficult year, undoubtedly. What results did the EAEU have, if we talk about the economic development of its member states?

– The main challenge in the past year, of course, was the COVID-19 pandemic, to overcome the consequences of which considerable efforts and resources of the countries of the Eurasian Economic Union were directed.

Citizens' health is a special agenda of the EEC Board, which continues to pay great attention to the economic cooperation of the Union states in the field of healthcare. Together with the EAEU countries, we are developing a draft program for cooperation in the field of healthcare in terms of ensuring the availability of modern achievements for the citizens of our states. An action plan has been approved to increase the level of provision of the EAEU countries with strategically important medicines until 2024. The Council of Heads of Authorized Bodies in the field of sanitary and epidemiological welfare of the population of the EAEU states has determined a set of measures to resume free movement of citizens of the member states through the Union. The implementation of these measures helps to increase the level of social protection of citizens of our countries.

2021 was the first year of the implementation of the Strategy-2025 as a tool for building the economy of the future and the foundation for the development of the EAEU. The well-coordinated and operational work of the Commission, coupled with the actions and measures of the national economies of the Union countries, made it possible to achieve positive dynamics of the EAEU economies.

According to our calculations, by the end of 2021, the volume of foreign trade exports reached 500 billion US dollars – the maximum value since 2015, and the volume of mutual trade (an increase of 32.4% in 11 months) exceeded 70 billion dollars and reached a new maximum historical value.

Compared to January – November 2020, exports of goods to countries outside the EAEU increased most from Belarus and Russia – by 50.3% and 45.4%, respectively. The main buyers of goods exported from the EAEU were the countries of the European Union (their share was 42.2% of exports) and the Asia-Pacific Economic Cooperation (28.6%).

The GDP of the EEC increased by 4.7% in 2020 compared to 2015 (1,738 billion US dollars by the end of 2020). For 9 months of 2021, the EAEU's GDP amounted to more than $ 1,425 billion (at the end of the year, according to the EEC forecast, an increase of 4.1%).

I would also like to note that 15 international treaties entered into force in 2021 and 9 were signed, which are currently undergoing ratification in the countries.

A Protocol to the Interim Agreement leading to the formation of a free trade zone between the Eurasian Economic Union and Iran has been signed.

The main directions of the EAEU's international activities for 2022 have been approved. The Heads of state approved the transition to the second stage of the formation of common markets for oil and petroleum products of the EAEU. All the activities of the first stage – this is 2018–2021 – have been completed. Everyone will benefit from the fullscale launch of common markets: they will make a significant contribution to the development of the economy of the member states of the Union, strengthen the integration foundation of the EAEU, create new jobs, increase the competitiveness of our products, and become a powerful factor in the development of the Eurasian region as a whole.

I am convinced that the use of the internal and integration potential of the EAEU states can ensure, according to expert estimates, the annual growth rate of the EAEU GDP is higher than the global average – 4.5% versus 3.8–4%. This will strengthen the Union's position in the world: the share of the EAEU in world GDP may grow to 3.8%, in world trade – up to 2.7%. The effect for some Member States is estimated at an average of up to 13% additional GDP growth.

At the same time, it should be noted that the implementation of the Strategy-2025 depends, of course, on the will and desire of our states. In general, it can be stated that today the Union has proved its worth and, if necessary, is ready to face new challenges.

– There is still a significant gap in per capita income levels between the EAEU member states. Does this somehow have a negative effect on the integration process?

– It is no secret that the difference in the economic potentials of the Union countries creates different conditions for the development of national economies, which affects, among other things, the well-being of peoples. Nevertheless, this issue is primarily within the competence of national governments, which solve it based on their socio-economic realities and capabilities.

However, this moment has never had a negative impact on the integration processes. On the contrary, the very fact of the creation of the Union was due to the need to overcome as soon as possible the difficulties that countries had at a certain stage of their development and which could be solved much more effectively by joint efforts, rather than individually.

In today's difficult conditions, the EAEU countries are striving to do everything possible to improve the living standards of their population and prevent social problems. The efforts of the Eurasian Economic Commission are aimed at solving these tasks.

We have laid a good foundation – the Agreement on Pension Provision for Workers in the EAEU has entered into force, which granted everyone equal rights independent of citizenship. Migrant workers can receive a pension at their place of residence or in the country that has assigned the pension. The experience gained is summed up regardless of where it was obtained.

It was decided to lift restrictions for teachers and lawyers who want to work in another state of the Union. Workers have the opportunity to change the purpose of entry without leaving the country of employment.

The economically and socially important project "Work without Borders" has been launched, which provides people with the opportunity to find information online about available jobs and job seekers in other EAEU countries.

As a result, there is a decrease in the number of unemployed registered in the employment services of the population. Thus, at the end of September 2021, the number of unemployed decreased by 59.7% since the beginning of the year. At the same time, the registered unemployment rate for this period decreased by 2 percentage points and amounted to 1.3%. The average monthly nominal salary for January – October 2021 increased in all the EAEU states compared to the corresponding period last year. Real wage growth was observed in Belarus (by 4.8%), Kazakhstan (by 8.2%), and Russia (by 3.0% in January – September 2021).

At the same time, the above is not a complete list of what has been achieved only in the past year. There is a good foundation for the future for fruitful work to strengthen integration processes, a number of other significant projects have been implemented and launched.

Of course, the economies of the Union countries can develop at a faster pace, ensuring the growth of the well-being of the citizens of our countries. The Eurasian Economic Commission is working as a priority to solve practical problems of the development of the economies of the EAEU member states.

To do this, it is necessary to move decisively and unambiguously from the logic of development in the format of a "trade union" to the full integration of the industrial potentials of the member states and innovative development. The implementation of the classic four freedoms – freedom of movement of goods, services, labor and capital – certainly remains on the agenda of the Union, but it is extremely timely to supplement this list with a kind of the "fifth freedom"– joint investment and innovation activities of the member states. In fact, the presented prototype will allow you to combine the accumulated achievements and bring integration to a new level.

– Increasing the pace of economic growth within the EAEU is related directly to the need to increase the competitiveness of national economies. How are things in the Union in this regard? What areas of work will be relevant in the near future in the context of improving competitiveness?

– Ensuring the growth of the competitiveness of the Union's economy and its goods, of course, remains an extremely important task of our work. However, let's be frank: today, despite the fact that there are about 16 thousand joint ventures in the EAEU, our industrial goods still have an insufficiently high level of competitiveness and a small share of gross value added. Increasing investments in fixed assets and increasing labor productivity, creating optimal organizational and legal conditions for working in the Union market can correct the situation.

In our opinion, Eurasian multinational companies should also play a major role in the development of the Union's economy. Systematic work has launched to develop cooperative ties in priority sectors: mechanical engineering, electrical equipment manufacturing, automotive, metallurgical production, light industry.

I emphasize that combining the potential will allow the Union to create large competitive corporations that will be able to meet both the needs of the domestic market and enter the markets of third countries.

To do this, the EEC will introduce new motivation tools. For example, the Commission, together with the member States and the Eurasian Development Bank, is currently developing acceptable preferential conditions for financing industrial cooperation projects; the possibility of using the resources of the Eurasian Stabilization and Development Fund, as well as the mechanism of interstate programs and projects.

If we talk about our immediate plans, then one of the important areas of work this year is the digital transformation of industry in the EAEU. This will be a new stage in the development and modernization of industrial production and the key to successful competition of our products on the world market.

According to UNCTAD, the share of the digital economy in global GDP rang es from 4.5% to 15.5%. The prospects for its further growth are obvious. Today, almost 40% of the value added created in the global information and communication technology sector is accounted for the United States and China, while the share of the digital economy in the EAEU space is less than 3% of GDP.

Already, the member states of the Union have formed a request for the creation of an industrial information system within the framework of the EAEU. The system should link production and scientific organizations, consumers of industrial equipment, goods and services. We expect to launch this system in 2023. All countries of the Union have their own digital priorities and national programs for digital transformation of individual industries and the economy as a whole. But there is a large layer of issues that can be dealt with effectively only at the supranational level. This includes building cross-border industrial cooperation, forming an ecosystem of digital transport corridors, and creating a "smart" Eurasian system of digital technical regulation. The Commission is already developing the relevant projects.

Digital technologies are not an end in themselves, but remain one of the most important tools. However, when making decisions in this area, it is necessary to monitor very carefully so that digitalization does not turn from a growth driver into a new technological barrier; so that the use of Eurasian platforms contributes to accelerating economic processes, reducing the cost of production, logistics, and sales. In the context ofa pandemic and sanctions pressure, this is and will remain our priority.

In addition, to ensure the competitiveness of the modern economy, it is necessary to support research and development work, which should become the basis for the technical re-equipment of economies and increase innovation activity. However, sufficient attention has not yet been paid to the development of fundamental and applied science, and the amount of funding for development still lags significantly behind the global average.

In Russia, R&D financing is 1% of GDP, while in the rest of the Union countries this value does not exceed 0.6%. At the same time, the knowledge intensity of the economy of the leading countries of the world is more than 3% with a tendency to further growth. To ensure the competitiveness of the modern economy, the share of R&D expenditures in GDP should be increased at least twice. Moreover, it is necessary to stimulate investments in science from the commercial sector, and not only through government funding. The pandemic has shown the vulnerability of humanity and exposed the contradictions between the leading economies. To compete effectively with economic giants, smaller economies need to unite and strengthen institutional cooperation – there is no alternative here. The political will of the heads of the EAEU member states to deepen integration should be enshrined in economic development. The Eurasian Economic Commission creates the necessary conditions for this and knows what we should do in the future.

– Let’s continue our talk on competition. What tools are currently used to create a favorable competitive environment in the EAEU?

– First: public procurement. Over the past year and a half, we have made great progress in ensuring access of goods produced in the member States of the Union to participate in public procurement, which creates conditions for the development of competition at auctions. This is facilitated by the Rules for Determining the Country of Origin of Certain Types of Goods for Public Procurement purposes, approved by the Decision of the Commission Council No. 105 of November 23, 2020 (Rules of origin).

Today, the Rules of origin include production conditions for the main goods that are transported between the countries within the framework of public procurement (light industry goods, automotive). This ensures the in tensification of trade from both sides, promotes the establishment of cooperative ties between manufacturers of final products and components.

In particular, now the Eurasian Register, formed by the Commission, includes information on 4704 goods from 47 manufacturers from Belarus and Kazakhstan. We hope that other countries will join the formation of the register soon.

I would like to note that an objective necessity for effective business operation is clear rules of the game in a particular market. The Rules of origin give business this clarity, defining the general conditions for inclusion in the Eurasian Register and confirmation of the country of origin when participating in public procurement. Accordingly, this made it possible to avoid unnecessary, additional requirements, which often lead to the creation of advantages for individual manufacturers or goods, leveling the efforts of the state to create conditions for fair competition.

I believe that, among other things, the adoption of the Rules of origin and the creation of the Eurasian Register last year made it possible to increase the supplies of goods to the Russian Federation produced in the Union countries under direct contracts. The supply volume in result of the concluded contracts grew by 3 times – from $ 8.4 to $ 25 million.

In order to support their producers, states periodically impose certain restrictions on imported goods that directly affect competition in public procurement. At the same time, in the territory of the state in which restrictions are imposed, there can be only one manufacturer who will dictate the conditions on the market of such a product. The antimonopoly authority should closely monitor it.

The rules of origin allow access to the public procurement market for goods from manufacturers from other countries of our Union. This is how the situation in the market is adjusting, where there was only one business entity, conditions are being created to increase the efficiency of procurement procedures and budget spending.

Second: law enforcement (soft regulation). The competence of the EEC Competition and Antimonopoly Regulation unit includes monitoring compliance with competition rules in cross-border markets, where the main task is precisely the restoration of competition. To do this, we use "soft regulation" mechanisms and new tools – warnings and warnings.

Mikhail Vladimirovich Myasnikovich is a well-known Belarusian public official.

He held the positions of Deputy Chairman of the Council of Ministers of the BSSR, Chairman of the BSSR State Committee for Economics and Planning (1990), First Deputy Chairman of the Council of Ministers of the Republic of Belarus (1991-1994), Deputy Prime Minister of the Republic of Belarus (1994-1995). From 1995 to 2001 - Head of the Presidential Administration of the Republic of Belarus.

In 2001-2010 - Head of the National Academy of Sciences of Belarus (President, since 2004 – Chairman of the Presidium).

In 2010-2014 – Prime Minister of the Republic of Belarus.

From 2015 to 2019 - Chairman of the Council of the Republic of the National Assembly of the Republic of Belarus of the fifth (2015-2016) and sixth (2016-2019) convocations.

From February 1, 2020 to the present – Chairman of the Board of the Eurasian Economic Commission.

Doctor of Economics, Professor, corresponding member of the National Academy of Sciences of Belarus, full member (academician) of the International Association of Academies of Sciences. Author of monographs, scientific papers and publications in the field of economics, international integration and state building.

He has three commendations from the President of the Republic of Belarus. He was awarded the Orders "Badge of Honor", Fatherland II and III degrees, Friendship (Russian Federation, People's Republic of China); badge "Gold Medal of the National Academy of Sciences of Belarus "For a great contribution to the development of Science", D. Cantemir Medal of the National Academy of Sciences of Moldova, a large gold medal of the National Academy of Sciences of the Republic of Armenia, V.M. Ignatovsky badge of Distinction of the National Academy of Sciences of Belarus.