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EAEU and Singapore signed Free Trade Agreement

EAEU and Singapore signed Free Trade Agreement

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10/2/2019

The first Agreements from the package of a comprehensive trading deal between the Eurasian Economic Union (EAEU) countries and the Republic of Singapore were signed during the meeting of the Supreme Eurasian Economic Council (SEEC) held on October 1. The documents were signed by Tigran Sargsyan, Chairman of the Board of the Eurasian Economic Commission (EEC), Deputy Prime Ministers of the Union as well as Tharman Shanmugaratnam, Senior Minister, Minister-Coordinator for Social and Economic Development of Singapore.

Commenting on signing the Agreements with Singapore, Tigran Sargsyan stressed their great importance for the development of trade and economic cooperation of the Union in the entire Asia-Pacific market.

"We are developing new approaches in implementing our international agenda, - Tigran Sargsyan emphasized. – Essentially, we are expanding the Commission's powers, involving the investment and services issues in our agreements with third countries. These issues are now at the national level. In order to make conditions in our common market comfortable for our trading partners, in this case these conditions for Singapore must comply with the Union-wide approach".

It is very important to extend this Singapore experience to other countries. "In particular, we are negotiating with Israel, – said the Chairman of the EEC Board. – And our Israeli colleagues suggested that the agreement developed jointly with them should be comprehensive, so that the conversation was not only about tariffs, in other words free movement of goods, but also included investment and services sections. Using exactly the same formula, which is now being implemented with Singapore. Singapore is a good example, we should use this practice".

The Free Trade Agreement provides for duty-free access for all goods of the EAEU countries allowed by Singapore. In turn, the obligations of the Eurasian Economic Union imply the provision of duty-free access for Singaporean goods, which make up 40% of the total commodity nomenclature, promptly following the effective date of this Agreement. With an increase of up to 87% at the expiry of all transition periods, which range from three to ten years.

"Despite the fact that Singapore generally does not apply effective rates of import customs duties on imported goods, such obligations insure the EAEU suppliers against possible changes in Singapore's customs tariff policy in the future. In particular, Singapore has an opportunity, according to its rights in the WTO, to increase the rates of import customs duties on agricultural products to 10%, and on industrial products - to 5%, 6.5% or 10%. Furthermore, the rates of customs duties for Singapore are not "bound" with regard to 28% of tariff lines from the entire nomenclature, which means that they can be increased to any level, for example, to a barrage of 100% or more", - Veronika Nikishina, Member of the Board –Minister in charge of Trade of the EEC, commented on the tariff arrangements enshrined in the Agreement.

In addition to tariff obligations, the Agreement provides for legal guarantees for implementing basic principles of non-discrimination of goods produced in the Union countries in relation to goods manufactured in Singapore (national regime) and imported to Singapore from third countries having no free trade regime (most favored nation treatment), in all matters of foreign trade activities, imports and commercial turnover.

The Agreement also establishes obligations to comply with international standards for applying licensing procedures; prohibitions and quantitative restrictions; technical regulation and sanitary and phytosanitary measures; transfers and payments for the supply of products; fees associated with customs procedures "at the border" and use of anti-dumping, countervailing and special protective measures.

Along with classic arrangements in the sphere of trade in goods, the Agreement has also formed a significant foundation for developing cooperation and improving its quality in such areas as e-commerce, environment, combating anti-competitive practices, transparency of public procurement and protection of intellectual property rights, which is especially important when discussing issues of technology transfer. 

"We consider the entire package of arrangements, consisting of agreements concluded today and four bilateral agreements on trade in services and investment, which have yet to be concluded by Belarus, Kazakhstan, Kyrgyzstan and Russia, as a whole. Reasoning from this fact, it is expected that the entire package will enter into force synchronously, the comprehensive free trade regime will start working all at once”, - Veronika Nikishina concluded.​