A More Reluctant Union

At some point over the past year, officials in Kyrgyzstan began to read the writing on the wall. After leaders from Russia, Kazakhstan, and Belarus signed the Eurasian Economic Union’s founding documents in May 2014, and after the treaty came into force in early 2015, it seemed but a matter of time before Bishkek came into the EEU’s fold.

In May, the inevitable came to pass, and Kyrgyzstan joined up with the greatest attempt at post-Soviet economic integration yet seen. Heads of the other EEU members – now including Armenia – signed the requisite documents on Bishkek’s accession, and their rubber-stamp parliaments stand ready to formally expand the organization to include a fifth member.

But don’t conflate accession with celebration. If you’re expecting resounding excitement in Kyrgyzstan about joining an organization that, according to Russian President Vladimir Putin, represents a new “epoch” and a new geopolitical “pole,” you’ll likely come away disappointed. Indeed, for as long as Kyrgyzstan understood it would be arm-twisted into the union, it’s done nearly all it can to delay the inevitable. The former prime minister once noted that there was “no alternative” to joining, while the president was even blunter. “No offense, but we’re choosing the lesser of two evils,” he recently said. “We have no other option.”

There are myriad reasons for such hesitancy. Begin with the broader geopolitical context. Kyrgyzstan, depending on the metric, is often cited as the country with the second-highest dependency on foreign remittances in the entire world, with remittances often equaling more than 30 percent of GDP. (The only country with a higher dependency rate is Tajikistan.) The predominance of these migrants head to Russia for work – as vendors, in construction, as taxi drivers – for most of the year.

However, with the onset of the Russian economic contraction, work has dried up, taking potential remittance with it. The global collapse in hydrocarbon prices has rattled the foundations of the Russian economy. In addition, Western sanctions are battering Russia for its neo-imperialist push into Ukraine. As a result, the ruble continues to be one of the most devastated currencies of the past year. The economic ripples have reached the wide post-Soviet space, taking Kyrgyzstan’s economic viability with it. While Bishkek has thus far avoided the recession besetting Moscow, a recent report from the European Bank of Reconstruction and Development extended Moscow’s recession through 2016, projecting that the Russian economy will shrink nearly two percent next year.

Early results of the downturn barreling toward Central Asia are already evident. According to the World Bank, remittances in the region are likely going to drop nearly 25 percent this year. While Tajikistan may yet see a larger hit – projected at up to a 30-percent drop, equivalent to some 15 percent of the country’s GDP – Central Asian declines, as a whole, outpace those of any other region in the world. And it’s not as if the regional governments appear to offer any way out of the jobless morass, or even if they’re aware of the crisis at hand. Kyrgyzstani politicians appear too busy with political infighting – or scraping to implement anti-LGBT and anti-NGO laws, along the Russian model – to offer much in the way of a response to the looming crunch. (To be sure, at least they’re not set to invest $100 million in a new theater, as Tajikistan’s government recently pledged.)

But the broader context is only one component. If Kyrgyzstan’s primary economic lifeline stands in its remittances, the next pillar is within its re-export trade from China, found namely within its Dordoi bazaar. A World Bank report from 2009 described Dordoi as a “state within a state,” noting that it saw nearly $3 billion in annual economic turnover. Adjusting tariffs to meet EEU standards, however, will all but dry up the advantages Dordoi gleaned through re-export. Again, while firm numbers remain to be seen, early indicators are not good, with certain sellers estimating that re-exports have already sunk 90 percent from their earlier peak.

As if adjusted customs didn’t present enough difficulty, Kazakhstan has been widely seen as pushing back against Kyrgyzstan’s accession, wary of increased movement – of both goods and people – on its southern flank. While Kazakhstani President Nursultan Nazarbayev has often cited potential expansion of the union to India, Vietnam, and Turkey, he has remained oddly mum on Kyrgyzstan’s accession. He has also seen his country take a decidedly protectionist turn ever since the EEU came into force.

Kazakhstan’s isolationist turn points to the third, and perhaps most disconcerting, trend within the Eurasian Economic Union. Where the union was once a feasible, largely welcome mechanism for economic integration – in a region often viewed as the least-integrated in the world – it has morphed into a vehicle to paper over Russia’s revanchist turn. (The Russian invasion of southern Ukraine, after all, arose after Kyiv’s former leadership failed to thread the needle between the EEU and the European Union.) Both Kazakhstan and Belarus have also enacted either formal or informal customs checks along the Russian border, hoping to stall Russian economic malfeasance, thereby negating the main purpose of the EEU.

Neo-Imperialist Policy

Kazakhstan has also stood at the fore in attempting to delay the EEU’s politicization, successfully striking down common defense policies, a Eurasian parliament, and unified passport systems, as well as repeated Russian attempts to enact a common currency. Where the EEU once stood for much-needed economic integration, it now stands as Russia’s foremost vehicle for the Kremlin’s neo-imperialistic policy. Where the union stood for filial friendship between post-Soviet nations, the contretemps between the nations is as glaringly obvious as the Russian troops in eastern Ukraine.

And Kyrgyzstan has taken note. Not only has broader support for joining the union continued to fall over the past few years, but Russian troops parading through Bishkek for Victory Day celebrations – the first time Russian troops have marched through the city in the post-Soviet period – sparked swift blowback in online discussions, pointing at underlying issues of independence and military capacity. Kazakhstan has seen “sovereignty” tossed around as the buzzword in pushing back against Russian suggestions, and Kyrgyzstan has begun following suit, all the more as EEU membership comes to bear.

Still, joining was all but a fait accompli. Kyrgyzstan could delay for only so long before economic and political demands won out. Moscow wanted Kyrgyzstan in the Eurasian Economic Union, and Kyrgyzstan held out as long as could reasonably be expected. If it’s worth anything to officials in Bishkek, the EEU is a shadow of its potential self, with regulations ignored and expectations unmet. Kyrgyzstan may yet be able to work around restrictions on re-export trade, and prevent further expansion of Russian demands on Kyrgyzstani sovereignty. But that remains to be seen, and will have to take place within the Union. As one regional observer recently noted, “Russian officials tell you Kyrgyzstan wanted to join the EEU – Kyrgyz officials tell you they had no other choice.” And they didn’t, really. Nor do they have much of a choice about the economic crunch looming just ahead, which they’ll now face as part of an organization they never really wanted to join in the first place.