In the last while there have been frequent statements that Ukraine’s probable refusal to form the Single Economic Space (SES) will not impede the integration process within the limits of the “SES Three,” i.e., Russia, Belarus, and Kazakhstan. It was not surprising to hear Nursultan Nazarbayev declaring that if Ukraine slows down the SES-formation process, “we may have to do without that country.” What caused utter surprise was a similar comment by Dmitriy Sukhoparov, Russia’s coordinator in the SES Formation High-Level Group. The impression is that Russian officials are losing track of the situation and mixing up their terms. It is no secret that the SES project was conceived in order to draw Ukraine back into the political integration processes in the post-Soviet space; in other words, it was specifically devised for Ukraine. Therefore, statements that the SES “does not need” Ukraine are, first of all, illogical, all the more so as Russia, Belarus, and Kazakhstan have already achieved a far closer integration as part of the Eurasian Economic Community (EAEC). “According to documents, the EAEC already exists in the form of a customs union, so it would be absurd for these three countries to repeat in the SES the steps they took four or five years ago in the EAEC,” says Oleksandr SUSHKO, director of the Center for Peace, Conversion and Foreign Policy of Ukraine.
This discrepancy between the actual and declared positions of the Russian partner looks like foul play, and the entire situation resembles political blackmail: if you don’t accept our conditions, there’ll be no conditions at all. Another “unsportsmanlike” factor was the statement of the Belarusian rep in the High-Level Group that it is impossible to establish a SES free trade area in July, on which Ukraine is primarily insisting. “This is an element of verbal pressure on Ukraine, which aims to show that, first, our position is non- constructive and, second, that they can do without us,” Mr. Sushko says. It should be recalled that the SES is a good-will organization, every member of which pursues its own interests. So it would be logical to suppose that if other SES members do not care about Ukraine and its interests, it would be a good idea to drop this project. Mr. Sushko believes, however, that “our leadership is so cautious that it won’t take such an abrupt step, although it should. This is a game of interests, an element of diplomatic bargaining.”
So we can only hope that the Ukrainian leadership will not give in to blackmail or make concessions by repeating previous statements about the likelihood of SES supranational bodies in the future. “In all likelihood, Ukraine will stand its ground, i.e., demand the creation of a free trade area - not the so-called free trade area stipulated in the SES agreement, where this term in fact means a customs union with elements of an economic union, but a genuine free trade area, the way it is defined in WTO documents,” Mr. Sushko noted.
As for Ukraine’s accession to the WTO, which some Ukrainian politicians say is possible before the end of this year, the Russian side has already been sending out warnings. According to Sergei Glazyev, head of the Federation of Russian Commodity Producers, “Ukraine’s entry into the WTO in fact is making it impossible to establish a customs union and implement plans to form a SES that would include Ukraine and Russia. But “from the economic viewpoint, the WTO does not like customs unions,” Mr. Sushko emphasized, explaining that every country pursues its own interests while negotiating with the WTO, and the interests of Ukraine and Russia are entirely different. Therefore, the two countries will find it very difficult to combine their WTO and SES priorities. By all accounts, there will be another difficult period of SES talks, although, in Mr. Sushko’s view, “the talks have reached rock bottom: it is impossible to solve any multilateral economic problems in this kind of format.”
