Cheese and sugar from Serbia at the door of the Eurasian Union – Negotiations about forming the free trade zone begin

The presidents of the five states which make up the Eurasian Economic Union (EEU) have decided to start negotiating with Serbia about the formation of a mutual free trade zone. This should create the conditions for the duty free exporting of the Serbian Fiat, but also of cheeses, sugar and other agricultural goods. The Union comprises Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan. A free trade agreement has already been signed with Vietnam, and the Union is also negotiating with Israel, India, Egypt and Iran.

Serbia has individual free trade agreements with three EEU members – Russia, Belarus and Kazakhstan, and with Armenia and Kyrgyzstan, agreements on preferential trade regime.

After the announced negotiations have been finished, a new agreement will be signed between Serbia and the Union as a whole, it was announced following the session of the Supreme Council of that organization in the capital of Kazakhstan.

- This isn't just about Fiat, it's about all kinds of goods that will fall under the duty free trade regime. It is our goal to keep the current level of liberalization – 99% of the goods are already in the free duty regime. Another goal is to enlarge and expand the scope of the goods we're exporting, whether it's Fiat, cheeses or certain agricultural goods – said Rasim Ljajic, Minister of Trade, Telecommunications and Tourism.

Dejan Delic of the Chamber of Commerce and Industry of Serbia emphasized that the negotiations were expected to begin and end during 2016.

- We don't expect the conditions to worsen, considering that around 99% of the goods are already being exported free of duty. CCIS will ask for further liberalization with the Eurasian Economic Union, especially for cheeses, tobacco and sugar – said Delic.

Minister Ljajic emphasizes that it is in Serbia's interest for the negotiations to be over as soon as possible, but also that it's not up to Serbia only.

- The situation is clearer with the countries with which Serbia has already signed individual agreements, except for Kazakhstan, which has shown some resistance to our exporting of Fiat, so it remains to be seen what will happen regarding the Kazakhstan negotiations. I don't believe that there will be problems with the Russian Federation and Belarus. Another kind of issue is Armenia's and Kyrgyzstan's coordination with the merchandise which used to fall under the duty free regime – said Ljajic.

In the first four months of this year, Serbia has increased the exporting into the Russian Federation, the most important member of the EEU, by 22% relative to the same period last year. The expectations for this year are for the exporting to exceed a billion dollars, which was its value in 2013 and 2014, and to increase it even further next year, with a new agreement.

- We expect about a billion and a half, and we are secretly hoping for over two billions – said Delic.

They claim that the European Union doesn't mind Serbia's negotiations with the Eurasian Economic Union, and the Chamber of Commerce says that, following the news about the beginning of the negotiations, they were contacted by a well known French cosmetics company, which inquired about the possibility of cooperation.