Asean eyes Moscow free-trade deal

Radisson Blu Resort & Congress Centre, Sochi. Source: Wikimedia

Malaysian Prime Minister Najib Razak said the Asean-Russia commemorative summit could result in a free-trade deal.

He said Asean agreed during the Sochi event to examine establishing a free trade deal with the Russian-dominated Eurasian Economic Union (EAEU). He told Russian broadcaster RT that the summit provided the opportunity “to look at what we have accomplished and to look forward” after 20 years of Asean-Russia ties.

“The most important item is the consensus among Asean that we need to seriously look at establishing a free trade agreement with the EAEU,” he said.

The EAEU also includes Armenia, Belarus, Kazakhstan and Kyrgyzstan. Russia has been a “dialogue partner” of Asean since July 1996.

Najib said other Asean members had submitted a request to establish ties with EAEU.

“We have to decide if we should go on multilateral basis or bilateral basis but whatever it is, importantly, the outcome should be the desire for us to achieve eventual economic integration,” Najib said.

The prime minister also stressed the importance of working with Russia on security, politics and cultural issues. Najib said he foresaw tariff reductions, movement of goods and services, without the need to complicate a deal with any political and sovereignty issues.

Asean and EAEU have an estimated combined GDP of US$3.5 trillion and a population exceeding 700 million. “It’s a huge market with enormous potential. The most important thing is to engage in the process of consultation, negotiation and avoid contemplating sanctions, because I think is will hurt more people than you intended,” said the embattled premier.

Russian President Vladimir Putin said that the common task was to “facilitate rapprochement of the economies, strengthen trade and investment ties and create background for launch of new projects”.

“Last year the trade turnover between Russia and Asean reached US$13.7 billon,” Putin said. The former KGB officer also said, “this figure looks rather modest compared with other countries of the Asian-Pacific Region, for example the turnover between Asean and China tops US$80 billion, and the same about our turnover with China”.

“The current level of investment cooperation is also lagging behind the existing potential,” Putin said. “The total volume of investment is around US$11 billion so we all need to think about what should be done to improve the situation and find ways to boost business cooperation.

“I would like to promise you that we are interested in advancing our relations,” he said. “We will be doing as much as we can to support and promote your joint work on the Russian market and on the market of Asean.”

And the president is looking even further afield. “Everything that there is on the positive side in the sphere of integration, everything that will expand our opportunities, and, consequently, our opportunities as representatives of state power will be used to the benefit of economic development and for the good of our countries’ people,” the veteran leader said.