May 2, 2022
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EAEU and macroeconomics

In order to quickly overcome the consequences of the current economic crisis by the EAEU Member States

The Supreme Eurasian Economic Council defines ensuring macroeconomic stability as one of the main directions of the economic development of the EAEU. The coordination of macroeconomic policy is set by the creation of a single economic space in the EAEU, i.e. a single market for goods, services, labor and capital, in which national borders no longer play a significant role from an economic point of view. Due to the fact that a significant part of the regulation of the economy is carried out at the national level, through a coordinated macroeconomic policy, the integration goals of the Union, the national development objectives of the Member States and ensuring the economic sustainability of the association as a whole are joined.

Development and adjustment The main guidelines for the coordinated macroeconomic policy of the Member States carried out by the Eurasian Economic Commission (EEC) annually. This is a comprehensive strategic document that defines the goals and objectives of the economic development of the Union, the areas in which cooperation can positively affect the competitiveness of the Member States, as well as the criteria for determining areas of the economy with integration potential. In order to harmonize state medium-term macroeconomic forecasts, the most important external parameters of such forecasts (the pace of development of the world economy, Brent oil prices) are agreed annually. In addition, one of the most important mechanisms that allow member states to implement a coordinated macroeconomic policy is the development and implementation of recommendatory supranational documents.

Taking into account the mutual influence of the economies of the Member States of the Union and in order to achieve a balanced and sustainable economic development, the members of the EAEU adopted an agreed decision to determine at the supranational level macroeconomic indicators that characterize the sustainability of economic development, and to introduce threshold values ​​for these indicators. These include:

– budget deficit of the general government sector (should not exceed 3% of GDP);

– debt of the general government sector (no more than 50% of GDP);

– the inflation rate in annual terms (should not exceed by more than 5 percentage points the inflation rate in the Member State in which this indicator has the lowest value).

In the event that the macroeconomic indicators of any EAEU state do not comply with the established quantitative values, measures and recommendations of the Eurasian Economic Commission are developed and implemented aimed at stabilizing the economic situation.

On May 21, 2021, the Supreme Eurasian Economic Council approved “The main guidelines for the macroeconomic policy of the EAEU Member States for 2021–2022“. As the goals of such a policy in the medium term, the document provides for the preservation of macroeconomic stability and the achieved standard of living of the population in the EAEU states, GDP growth at the level of 4.5–5.5% per year, as well as the formation of the foundations for further advanced economic development of the Union. The document contains a number of measures aimed at containing the negative impact and minimizing the economic consequences of external shocks associated with the “pandemic” and a sharp decline in commodity prices.

Achieving the set goals involves the implementation of integration and national measures in the following areas: maintaining macroeconomic stability; investment growth; development of the scientific, technological and production potential of the Union; creating conditions for maintaining stable demand, expanding export opportunities, and intensifying mutual trade.

According to the EEC forecast, in 2022-2023, there will be a high probability that member states will exceed the established quantitative values ​​of macroeconomic indicators that determine the sustainability of economic development. If the current system of economic regulation is maintained, in 2022–2023, the GDP growth rate may be 2.5–3.5 percent, which is 1.5–2 times lower than the growth rate of the leading countries. True, there are prerequisites for accelerating the economic growth of the EAEU member states due to the accelerated increase in investment and innovation activity based on the effective use of available reserves of production capacities, labor resources, and scientific and technical potential.

In order to promptly overcome the consequences of the current economic crisis by all EAEU member states and bring the Union onto the trajectory of advanced development of the EEC, special attention is paid to the development of flexible mechanisms for targeted assistance to economic development, building an effective system for managing joint cooperation projects and their financing, creating and developing high-performance ones, including number of export-oriented sectors of the economy and join efforts to stimulate joint research work.

In August 2012, the Advisory Committee on Macroeconomic Policy was established under the EEC Board under the chairmanship of the member of the Board (Minister) in charge of Integration and Macroeconomics of the EEC. Its main task was defined as: holding consultations with representatives of the EAEU member states in order to prepare conclusions and proposals for the EEC Board and develop an agreed position on draft decisions of the Union bodies; formation of unified approaches in the conduct of macroeconomic policy; harmonization of the laws of the EAEU member states in the field of economy and finance; development and coordination of the main guidelines for macroeconomic policy; preparation of regulatory legal acts of the Union aimed at ensuring sustainable economic development of the EAEU Member States; information interaction between the authorized bodies of the EAEU member states in order to monitor their economic development; application of the legislation of states in the field of macroeconomic policy within the framework of the legal framework of the EAEU. This Advisory Committee included 2 representatives from Armenia, 3 representatives from Belarus, 3 representatives from Kazakhstan, 3 representatives from Kyrgyzstan and 3 representatives from the Russian Federation (Deputy Minister of Economic Development P.V. Kryuchkova, Deputy Minister of Finance V.V. Kolychev and First Deputy Chairman of the Central Bank K. V. Yudaeva).

Under the Advisory Committee created: subcommittee for macroeconomic policy and two working groups: on the calculation of macroeconomic indicators that determine the sustainability of the economic development of the EAEU Member States and the assessment of their complianceI on macroeconomic modeling and forecasting.

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