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The Effect on Belarus Economy and Foreign Trade from Joining the Customs Union with Russia and Kazakhstan

Author: ZhangHaiShan
Tutor: SuZhenDong
School: Dalian University of Technology
Course: International trade
Keywords: Customs Union foreign trade macroeconomic model
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Type: Master's thesis
Year: 2013
Downloads: 17
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Abstract


Countries started to form customs and trade unions long time ago. Through time there were many examples of unions, that had huge consequences on economies of different countries-members of unions to the world trade in general. There are many points of view on pros and cons of forming trade unions between nations.On the6th of June2010Belarus joined Customs Union between Russian Federation and Kazakhstan. It has tremendous effect on its foreign trade and economy in general. Analyzing the consequences and the visible results is crucially important now. Very few research has been done on the topic and therefore the topic is very actual at the moment and a research in this field will have a great value.In my work I studied the history of trade unions and examples of them though time. In the second part of my work I analyzed foreign trade between Belarus, Russia and Kazakstan to see what impact joining the Union had to our economy.In the third part I built a macro model with the help of Eviews package in order to analyze the impact the Customs Union has on the economy in general.Estimation of consequences of joining the Customs Union by Republic of Belarus is a nontrivial task. Firstly, it is due to the significant number of product groups, for which there is a gradual unification of customs tariffs, each of which has a number of preferences. Secondly, in2011the Republic of Belarus went through a currency crisis, which left a significant imprint on the macroeconomic indicators, especially foreign trade. In the calculations, I will only consider the macroeconomic aspects.At the basis of the following econometric macro model used for analysis and forecasting of the most important indicators of the Belarusian economy lies a macro model, which was developed in the Economic Research Institute of the Ministry of Economy. The estimation is made on a real quarterly statistical data of Belarus with the Eviews package. With the help of Eviews I calculated different scenarios to see the consequences of the entering and not entering the Customs Union by Belarus. In this study the above mentioned model was improved with the addition of actual data for a number of years.

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