Leaders of Russia, Belarus, Ukraine and Kazakhstan plan signing agreement on common economic area

The leaders of four countries - Russia, Ukraine, Belarus and Kazakhstan - are expected to sign documents on establishing a common economic area (CEA) today at a summit in Yalta. Their leaders are expected to issue a statement on that and sign an agreement on establishing a common economic area and a concept of forming such a common market.

President of Russia Vladimir Putin said on the eve of the summit that big work had been done to draft these documents, and the CEA agreement would be a result of a compromise suiting all the signatories. He said also that the drafted documents provide a possibility for a very mild approach to implementing the understandings that have been reached." "I am absolutely convinced that these accords fully meet the national interests of our states," the Russian President said.

The agreement envisages a "milder structure" compared with, say, the CIS or EurAzAEC one and resembles more that of the European Union, a source in the Russian delegation told RIA Novosti.

According to the Russian spokesman, by establishing the CEA the four countries do not fence themselves off from the other CIS states. "Those of them which will be ready according to required parameters, may join the agreement," he said.

He sees "nothing dramatic" in the fact that before the summit Ukrainian parliament members adopted a resolution, stressing that the agreement should correspond to Ukraine's Constitution and its international commitments.

According to RIA Novosti sources in the Kremlin, the CEA is to become a new integration union established to ensure free movement of goods, services, capital and workforce. It will be based on a combination of inter-state and supranational elements providing for ceding definite powers of the countries to one regulating body. It is supposed in the Kremlin that, as integration among the member countries is growing deeper, the supranational elements will be expanding.

"The CEA does not contradict work in the CIS framework. On the contrary, it is a new model, more suited for the present stage of economic cooperation, taking into account also the experience of the CIS and the practice of such an effective integrated association as the European Union," a Kremlin spokesman told RIA Novosti.

It is supposed that the CEA will be established gradually, stage by stage, in keeping with the possibilities for integration effected on different levels and at varying rates. The time required for going over to higher levels of integration is to be determined by each state independently.

As the first stage it has been decided to establish a free trade zone without exceptions and limitations, which provides for non-use of anti-dumping and other protectionist measures in trade among the four countries, observance of common rules in competition and the use of various forms of state support. Ukraine firmly stood up for such a position. Besides, Ukraine said that it ruled out setting up supranational agencies, as this contradicted its Constitution.

The Russian side continues to insist on including in the CEA agreement a provision on introducing a common currency as the final phase in establishing such a common market.

The formation of a common market and its activities will proceed in keeping with the norms and regulations of the World Trade Organization (WTO), which each of the four states wants to join. In case one of the states joins the WTO earlier, it will help the other four to join that organization.

The signing of the agreement will open the way to drafting inter-state treaties designed for filling the CEA with concrete economic content. The basic agreement will become effective upon its ratification on the national level by each of the countries.

In the opinion of experts, it will take 5 to 7 years to complete the establishment of the CEA.

The sides have stressed that the CEA agreement is exclusively of an economic character and "will include no political statements."