Vladimir Putin's remarks:

Dear colleagues,

I suggest that next time we start with the Customs Union because we are only now coming to the substantive and difficult issues – essentially problems of integration that must be solved in a practical manner. This meeting has already taken up so much time, and we are already a bit tired, and we still have to deal with substantive issues, very complicated issues that are very important for the future integration of our countries.

Let's discuss the Customs Union and our common economic space. The customs territory of Russia, Belarus and Kazakhstan has become a reality, and today it yields tangible benefits to our economies and stimulates trade. All the issues regarding the transfer of agreed types of inspection (customs, transport, sanitary, veterinary, quarantine, phytosanitary) to the external borders of the Customs Union need to be resolved by July 1.

I suggest therefore that today we review the readiness of our supervisory services to work in the new conditions. Furthermore, we should sort out the situation with the goods for which Kazakhstan, for instance, will continue to use customs duty rates that differ from the unified customs tariffs. It is necessary to establish what administrative mechanisms Kazakhstan will use with regard to such goods, and of course we would like to hear a full presentation of the Kazakhstan position today.

Another topic I would like to draw your attention to is the drafting of the agreement on a unified procedure of export control on the territories of our countries. This turned out to be a difficult issue too. It is critically important to agree the common conceptual approach as quickly as possible. Naturally, one should take into account the interests and commitments of our countries and of course the interests of businesses that are directly engaged in foreign economic activity.

I should add that the principles built into the draft agreement must not contradict the export control practices of our countries. Let me elaborate. Import licensing should be performed only with regard to the products that are essential for national security and as a means of meeting our international obligations. Obviously, the introduction of the permission-based procedure for the sale of dual-purpose goods will erect barriers for the import into the Customs Union territory of advanced foreign technologies and high-tech goods, which in turn (as we are all very well aware) may impede the innovative development of our economies. I assume that none of us want this to happen. Let me also remind you that our commitments stemming from our participation in multilateral export control regimes do not envisage import control.

Next. Today we will discuss the draft treaty on the functioning of the Customs Union in the framework of the multilateral trade system which was of course approved by the Customs Union Commission in April. Under the draft, the WTO rules concerning the sphere regulated by the Customs Union become part of the legal system of our integration association.

We are to approve the acts on the coming into force of the international treaties on technical regulation and the protocols on the introduction of amendments to the Customs Union agreements on sanitary, veterinary-sanitary measures and plant quarantine.

I would like to reiterate that it is very important to fine-tune all the procedures and mechanisms of the Customs Union's work. This will be the jumping off point for the following steps that will take us to a qualitatively new level of integration – the creation of a common economic space. That would mark a huge leap towards integration. As of January 1, 2012 we shall have a common market with uniform legislation; free movement of capital, goods and services and labour; and, in the future, coordinated economic policies in the key sectors of our economies.

This aspect of integration will be our focus. One has to understand the concrete situation at every stage in the formation of the Common Economic Space, strictly meet all the deadlines and synchronise decisions on specific matters. Belarus has already ratified the entire package of documents on the common economic space, and Russia and Kazakhstan are completing ratification procedures. We are keeping the issue under constant review, and Russia will cover the distance on time as promised.

We are well aware of the need to change the current structure of the Customs Union Commission, as we have repeatedly pointed out. I believe it is necessary to step up the process of reforming the commission with a view to expanding its functions and authority. This discussion cannot be put off, as it is impossible to solve on a temporary basis all the problems that arise in real time.

We believe that the Customs Union Commission must rise to the challenge of our cooperation at the inter-state and at the supranational levels. The high-level group has prepared proposals on amendments and additions to the Treaty on the Customs Union Commission. I expect my colleagues to support them. That decision will go a long way to ensuring the success of our integration project.

The main thing is that the coming changes must make the work of the commission effective, especially in the light of its new powers on such issues as the coordination of an agreed macroeconomic policy, monitoring compliance with the common rules of competition as well as regulation of tariffs on railway cargo shipping. Agreeing the decisions of national bodies on these aspects of the activities of natural monopolies is yet another key problem.

I would also like to say that by launching the common economic space on January 1, 2012, we will fulfill the strategic tasks that were set ten years ago by the Eurasian Economic Community. These were precisely the goals we set ten years ago.

The common economic space opens up vistas for successful social and economic development and creates a powerful centre that will attract investment, new production, finances and trade – in effect the whole economic configuration of the Eurasian space will change.

I am convinced that we must look ahead and set ambitious goals. I should remind you that in March 2011 we agreed on the codification of the legislation of the Customs Union and then of the common economic space.

The strategic goal of codification is to develop a common international document of the Customs Union and the common economic space, the Treaty on the Creation of the Eurasian Economic Union. The Union will ensure mutually beneficial cooperation with other countries as well as international and regional economic associations, including of course the European Union, with the prospect of creating a common economic space. That implies further harmonization of each nation's legislation, the improvement and development of integration institutions, a higher level of economic interaction, improved working conditions and the removal of barriers to business.

Today we are to discuss the draft declaration on the principles of the formation of the Eurasian Economic Union. By January 1, 2013 we should complete preparatory work on the treaty on the Eurasian Economic Union.

I suggest that we now start discussing these issues. The first item on our agenda is the main results of the functioning of the Customs Union in the framework of EurAsEC and priorities for 2011-2012.