THE PROSPECTS OF KYRGYZSTAN’S ACCESSION TO THE CUSTOMS UNION AND COMMON ECONOMIC SPACE
Kubat UMURZAKOV, Nazira TYULYUNDIEVA
Kubat Umurzakov, Ph.D. (Econ.), Associate Professor at the Academy of State Governance under the President of Kyrgyzstan (Bishkek, Kyrgyzstan)
Nazira Tyulyundieva, Ph.D. (Econ.), Associate Professor at the Academy of State Governance under the President of Kyrgyzstan (Bishkek, Kyrgyzstan)
This article looks at the goals, conditions, and possible consequences of Kyrgyzstan’s accession to the Customs Union (CU) and Common Economic Space (CES), describes the current state of the country’s export and import situation, and analyzes the role of re-export in the Kyrgyz economy in the past decade. It studies the alleged positive effects and risks that could arise if Kyrgyzstan joins the CU and CES and presents the data of an analysis of the comparative advantages of commodity groups. The authors justify the importance of pursuing a coordinated policy with the other CU countries to develop priority industrial and agricultural sectors. This will encourage large companies to come to Kyrgyzstan and open their branches in the country, as well as help to solve tasks aimed at modernizing agriculture and creating an agroindustrial cluster.
Keeping in mind that commodity flows and business will have to undergo major reorientation after the country joins the CU and CES, the authors conclude that a certain transition period will be needed to enable gentler adaptation of the economy. The authors propose creating a mechanism based on EU experience within the CU and CES to support countries with slower rates of development.
Keywords: Kyrgyzstan, Customs Union, Common Economic Space, Common Customs Tariff, economic modernization, competitiveness, sensitive commodities, transition period.