THE DEVELOPMENT OF PRODUCTION CHAINS IN THE INTRAREGIONAL TRADE: LESSONS FOR THE EEU

Ol’ga V. Biryukova () and Ilya A. Manuylov ()

Economics of Contemporary Russia, issue 1

Abstract: The article is devoted to the development of global value chains within the regional economic integrations and to the successful experiences of these processes for the Eurasian integration. The development of production chains in the regional trade is possible under the conditions of the openness of the integration group for the international market and foreign direct capital, investment in the creation and development of the transportation systems, and the successive liberalization of tariff and customs restrictions. Using key economic indicators and trade data in terms of Trade in Value-Added (TiVA) produced by international organizations such as OECD, WTO and UNCTAD, the authors reveal the link between the trade policy and the involvement of countries in global value chains. The authors describe the opportunities of the development of production chains in the framework of Eurasian Economic Union, and what obstacles there are. For the analysis of openness of the Russian economy to the external market and assessing the involvement in global value chains the authors have also been used the elasticity of exports and imports. The article describes the industries in the countries of the Eurasian Economic Union, which relatively successfully involved in the global fragmentation of production. As a result of the analysis, the authors identify the main directions of improvement of the foreign economic regulation of the EEU countries for their active participation in global value chains while maintaining the priorities in the field of economic integration. The main of them are - development of the tax system, the coordination of macroeconomic and trade policies, elimination of non-tariff restrictions among participating countries. Improvement of customs regulation is impossible without the adoption of the customs code of the Eurasian economic union, which has to regulate the registration and control of imports to the single customs territory. The active development of intra-regional production linkages requires technological division of labor on the basic phases of product creation that, in turn, reduces commodity specialization in the mutual trade.

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