By Julien Segre, Palladium
It was in 1994 that Kazakhstan’s then-President Nursultan Nazarbayev, in a speech to Russian students at Moscow State University, first used the term “Eurasian Union” to suggest the creation of a regional trade bloc. He emphasized “the formation of a single economic space and the provision of a common defense policy.”
The comments came amid the catastrophic economic disintegration of formerly Soviet states in the 1990s. Between 1991 and 1993, there had been an 80 percent collapse in trade as new borders and currencies appeared overnight, breaking down supply chains that were previously integrated.
Privatization had put the assets of state enterprises under the control of different national firms. Some went bankrupt entirely, abandoning machinery and property too impractical to sell off. In a now-independent Kyrgyzstan, the sole Soviet firm dedicated to making hay bale machines collapsed when it couldn’t gather the Estonian kroons necessary to purchase the specific compressors—only the new Baltic state manufactured them. Even if they could have, new transit fees, tariffs, and customs duties that had never been factored into the economic equation were now wreaking havoc all across the post-Soviet space.
Nazarbayev’s idea to reintegrate wasn’t exactly new; he and other Central Asian Soviet leaders had generally opposed the Soviet dissolution to begin with. Anticipating the disruptions that such a move would bring, the presidents of Russia, Kazakhstan, and Belarus signed the Belavezha Accords in 1991, creating the Commonwealth of Independent States (CIS). It was technically a free trade area including almost all of the old Soviet Union, although with the notable absence of all the Baltic states.