Russian customs union with Belarus, Kazakhstan delayed

Russia's planned customs union with neighbouring Belarus and Kazakhstan will not fully come into effect from July as planned, Putin said.

Russian customs union with Belarus, Kazakhstan delayed

Russia's planned customs union with neighbouring Belarus and Kazakhstan will not fully come into effect from July as planned, Prime Minister Vladimir Putin told Mir TV in an interview on Saturday.

The customs union was envisaged as a first step on the way for the three former Soviet republics and allies of Moscow to create a free trade area, or single economic space, by 2012.

From July 1, they were meant to adopt a common external tariff and start redistributing the duties they collect.

"This is correct. It cannot come into full force," Putin told an interviewer who asked him whether the project would take full effect in July, after talks on it failed on Friday during a meeting in St Petersburg.

A Russian source had earlier told Reuters that finalising the union could be delayed beyond July.

Russia had pursued the project with fresh interest after putting talks to join the World Trade Organisation (WTO) on the back burner after more than a decade of wrangling.

"I have proposed today to accelerate solving the problems linked to a creation of a single economic space," Putin said, according to a transcript of the interview published ahead of the broadcast on the government website.

Instead of negotiating all the required documents by the end of next year, Putin said he wanted the whole process finished by the end of this year.

Now oil duties are holding the union back as Russia has refused to abolish export duties on oil it sells to Belarus, something analysts say Minsk had wanted and had seen as the key reason to join the pact.

Russia has also accused Belarus of not paying enough for gas deliveries and amassing debts while Belarus wants to pay less for oil and gas if Moscow is serious about developing closer ties with Minsk.

"They unilaterally pay us the 2008 price. They underpay us. There debt is accumulated. But this is still a problem between economic entities (corporations) and I hope the problem will be solved at that level," Putin said.

At the beginning of the year Russia and Belarus were involved in a month-long oil supply row that had threatened to disrupt oil flows to European Union members Germany and Poland.


Reuters

Last Mod: 23 Mayıs 2010, 17:54
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