The free trade zone of the Eurasian Economic Union (EAEU) and Serbia will begin its work on July 10.

This was announced by the EEC Minister of Trade Andrei Slepnev during the St. Petersburg International Economic Forum (SPIEF).

"We are launching free trade with Serbia on July 10," RIA Novosti quotes the minister.

Recall that the Free Trade Agreement between the EAEU and the Republic of Serbia was signed in September 2019.

Up to this point, bilateral free trade agreements operated between Serbia and Russia, Kazakhstan and Belarus.

In addition, the document assumed that after its entry into force, tariff restrictions would also cease to operate between the Balkan state on the one hand and Armenia and Kyrgyzstan on the other.

"This agreement will give a new impetus to expand trade and economic cooperation with Serbia," Tigran Sargsyan, head of the board of the Eurasian Economic Commission (EEC), said at the time.

Trade effect

As the Minister for Trade of the Eurasian Economic Commission (EEC) Veronika Nikishina explained after the signing of the document, the agreements on the creation of an FTA deepen the access of the members of the customs union to the Serbian market.

“In other words, we are giving a fully-fledged free trade regime for Kyrgyzstan and Armenia and are improving the existing bilateral free trade regimes for Belarus, Kazakhstan and Russia,” she said in an interview with RBC.

  • Signing of the Agreement on a free trade zone between the EAEU and Serbia

  • © eurasiancommission.org

For his part, Serbian Trade Minister Rasim Ljajic said that the creation of an FTA with the EAEU is not a political, but a trade deal similar to the one that Serbia previously signed with Turkey and CEFTA (Central European Free Trade Association).

“We should keep in mind that about 83% of our total trade with the EAEU countries falls on the Russian Federation, and therefore the signing of this single agreement is of such great importance to us,” Ljajic explained.

Recall that in 2019, the trade between Russia and Serbia amounted to $ 2.6 billion, an increase of 22.64% compared to 2018.

The volume of Russian exports to Serbia amounted to $ 1.5 billion in 2019. At the same time, in 2020, the volume of mutual trade decreased against the backdrop of the COVID-19 pandemic.

However, as experts note, in the current realities, the creation of an FTA between Serbia and the EAEU should be viewed more as a political gesture.

"The entry into force of this agreement will not change much, since the volume of Serbia's trade with Kazakhstan, Armenia and Kyrgyzstan is quite insignificant, while the bulk of trade within the framework of this partnership falls on Russia, with which a similar agreement was in force before," a conversation with RT, a leading researcher at the Institute of Europe of the Russian Academy of Sciences Pavel Kandel.

This point of view is shared by Mikhail Lobanov, Deputy Director of the Institute of Economics of the Russian Academy of Sciences, Associate Professor at the MSE MSU.

In an interview with RT, he called the signing of an agreement on a free trade zone with the EAEU "an image and political step" of Belgrade.

“In a difficult foreign policy situation, this is Serbia's curtsey towards Russia, which is important for the Serbian side from a political point of view.

For the EAEU, this event is also of great importance, since it increases the status of the union in the international arena.

At the same time, from an economic point of view, the effect will be insignificant, since the free trade agreement has already been in force with Russia, Belarus, Kazakhstan - the most important EAEU members for Serbia, ”the expert explained.

"Specific EU signal"

Serbian Prime Minister Ana Brnabic emphasized that Belgrade believes that this step does not contradict the republic's plans to join the European Union.

“I think the agreement in no way contradicts our [pro] European policy, but, on the contrary, complements it, as well as our course towards joining the EU.

After all, strengthening the Serbian economy meets the interests of the European Union, and the free trade agreement with the EAEU will give us the opportunity to achieve this, ”the head of the Serbian government said after the signing ceremony.

However, Belgrade's decision angered Brussels.

As the former European Parliament rapporteur on Serbia David McAllister (now the chairman of the EP foreign affairs committee. -

RT

)

said earlier

, the agreement between the Eastern European state and the EAEU should have “a withdrawal clause, which will ensure that by the time of joining the EU, Serbia will be able to withdraw from the agreement (with the EAEU. -

RT

) ".

“Serbia must ensure that all of its trade agreements, investment and economic cooperation agreements and other relevant agreements are compatible with EU legislation,” McAllister said in a 2019 interview with Radio Free Europe / Radio Liberty *.

For their part, analysts note that EU membership is not very compatible with participation in the free trade zone with the EAEU.

Therefore, says Pavel Kandel, as soon as Serbia comes close to joining the European Union, it will most likely have to break the agreement with the EAEU.

“However, when this may happen, they do not yet know either in Serbia itself, or even more so in the EU.

Belgrade aspires to the European Union, it regularly announces these plans and is in talks with Brussels.

However, this dialogue is not progressing very actively.

Considering the consequences of the pandemic for the European economy, the EU enlargement to the Western Balkans is unlikely to be the immediate priority of Brussels, ”the expert explained.

Mikhail Lobanov adheres to a similar point of view.

He recalled that trade relations between Russia and Serbia emerged a long time ago, although certain geographical and other restrictions still exist in them.

“After joining the EU, reorientation will begin, but it will be limited in scope.

Still, the EU's share in the structure of Serbia's foreign trade turnover is about 60-70%, while the EAEU's share is several times less.

Probably, the union of Belgrade with the EAEU will not become a brake on Serbia's path to the EU.

Rather, it is a certain signal to the EU from the Serbian authorities that Belgrade is ready for a bold policy, ”the expert said.

Kosovo question

Another demand that the EU puts forward to Serbia concerns the territorial issue.

The key condition for the republic's entry into the union is the conclusion of peace between Belgrade and Pristina.

Negotiations are under way with varying degrees of success, mediated by the EU and the United States.

So, in September 2020, the parties signed agreements in Washington designed to normalize relations in the region.

First of all, the agreements reached affect the economic sphere.

  • Checkpoint on the border of Serbia and Kosovo

  • AFP

  • © NEBOJSA MARKOVIC

At the same time, initially, the agenda of the negotiations contained an item on the recognition of the self-proclaimed Kosovo by Serbia.

However, later, as the Serbian leader Aleksandr Vucic said, this provision was ruled out. 

Nevertheless, the West continues to insist on the fulfillment of this condition, Vucic said on June 2 during a press conference with the Chairman of the Presidium of Bosnia and Herzegovina Milorad Dodik.

“People should know that America, Germany, the largest powers in the world, Western powers, demand that Serbia recognize Kosovo one way or another,” TASS quoted Vucic as saying.

Following the talks with EU Special Representative for Dialogue between Belgrade and Pristina Miroslav Lajcak and US Deputy Assistant Secretary of State for European and Eurasian Affairs Matthew Palmer on June 3, the Serbian leader issued an appeal stating that the dialogue with Pristina will be resumed soon.

However, according to experts, Belgrade is unlikely to succumb to pressure from the West and recognize the independence of the rebellious region.

“If this happened, the political career of Aleksandr Vucic and his supporters would have ended on the same day,” says Pavel Kandel.

Mikhail Lobanov adheres to a similar opinion.

“It is unclear how the Kosovo issue will be resolved.

It is only clear that Serbia's accession to the EU is impossible under current conditions.

It is obvious that the question of the recognition of Kosovo will be raised by the West again, both openly and indirectly.

But not a single political force in Serbia can make such a decision without losing everything.

So far, the Serbian leadership is trying to get out of the situation with its head held high, ”the expert summed up.

* Media recognized as a foreign agent by the decision of the Ministry of Justice of the Russian Federation dated 05.12.2017.