Not everyone will reap the benefits of the Lisbon-Vladivostok free trade zone

17 june 2016 | Rossiyskaya Gazeta

Germany supports a free trade zone with Russia. At the international economic conference East Forum Berlin more than 80% of the participants supported the idea of creating a free trade zone from Lisbon to Vladivostok.

Alexander Golyashev
Alexander Golyashev
Department for Research Studies

“We are currently seeing trade between the EU and the Eurasian Economic Union declining because of the EU’s sanctions against Russia and Russia’s self-imposed ban on buying European groceries. And despite the high expectations from a common free trade area, the first prerequisite condition that must be met before the idea is even discussed is normalization of the foreign policy dialog and the lifting of the mutual sanctions,” believes Analytical Center expert Alexander Golyashev.

Different companies will be affected differently by the creation of such a free trade zone. “Some will get free access to foreign markets while others will face more competition from foreign suppliers and may even be driven out of business entirely,” Mr. Golyashev explained to a Rossiyskaya Gazeta correspondent. So entrepreneurs are bound to be quite ambivalent about the project and the decision about whether or not to go ahead with it must be made at a political level.

The newspaper notes that the idea of a free trade zone including the EU and the Eurasian Economic Union is not new: Russia and the EU agreed to create a common economic space as far back as 2003. But a lot has changed since then and now it is not just Russia that represents the East at the negotiating table but also its partners in the Eurasian economic union. The new participants will only boost the potential of the future free trade zone, though.