GUAM: Makes economic interests closer

Analysis Materials 30 November 2010 11:09 (UTC +04:00)

Passing through a long way from the informal alliance of friends up to a full-value international organization, GUAM has become an important regional example of how sovereign states can join together to promote democratic ideas and develop economic and cultural cooperation. GUAM countries just belong to a group of countries in the former Soviet Union, which have a convenient location (mostly with good access to the sea ports), favorable climate, natural resources, conditions for the development of agriculture, transport (transit). In fact, it is a "Mediterranean" type of resource, which, as shown by the example of Cyprus, gives opportunity to develop the economy, even in very difficult political environment.

BACKGROUND INFORMATION: The GUAM Organization for Democracy and Economic Development is a regional organization of four post-Soviet states: Georgia, Ukraine, Azerbaijan, and Moldova.

Institutionally, the establishment of GUAM has gone through several stages.

I GUAM Consultative Forum

It was founded on Oct. 10, 1997 at the Council of Europe summit in Strasbourg.

II. GUAM Union.

It was founded on June 7, 2001 with the signing of the Yalta GUUAM Charter at the Summit of Heads of State.

III. Organization for Democracy and Economic Development - GUAM.

It was created on May 23, 2006 at GUAM Kiev summit, during which heads of states signed the Charter of the Organization.

Upon the Charter, the main goals of GUAM are: - to promote democratic values, rule of law and respect for human rights; - provide sustainable development; - strengthen international and regional security and stability; - deepen European integration to create a common security space, as well as expand economic and humanitarian cooperation; - develop socio-economic, transport, energy, scientific-technical and humanitarian capacity; - strengthen political interaction and practical cooperation in areas of mutual interest.

However, often opinions are heard that GUAM can function as a stable international organization, if it gains a corresponding economic dimension and the economic relations between members become more reasonable and stable. In this case, GUAM may be a quite viable economic entity.

For example, the President of Ukraine Viktor Yanukovych said that Ukraine will continue membership to GUAM only with gaining practical benefits from economic cooperation format, particularly the concentration of focus on the realization of the main goals of the organization - to promote socio-economic development of its member States. Making emphasis on the economy, official Kiev intends to focus on expanding trade and infrastructure projects. Foreign ministers of Georgia, Ukraine, Azerbaijan and Moldova have fully supported the action plan of Ukraine chairmanship to the GUAM by the end of 2010, which aims to strengthen economic cooperation and deepen sectoral cooperation.

The priority spheres for economic cooperation in the GUAM are: to deepen economic and trade relations; develop infrastructure corridors with appropriate harmonization of legal and institutional framework in this sphere; unify customs and tariff regulations with brining bringing them into conformity with the international standards; ensure energy security.

Analysis of the economic activities of GUAM has shown that the organization has reached a number of practical results in this regard. Special attention is paid to projects on the free trade zone, energy, tourism and transport. As a result of quadrilateral cooperation, the trade between the four countries expands and this year it will exceed $4.5 billion, increasing more than three times over last three years.

The main task of the union is to organize transport routes from the Caucasus to Europe, with the main emphasis made on transportation of energy resources. GUAM Secretary General Valeri Chechelashvili said that if there would be a well-functioning transit corridor between the GUAM countries, it will be a competitor to other transit corridors, located in the north and south. So, at the expense of the GUAM transit corridor, in the first half of 2010, Ukraine covered its needs for crude oil by 25 percent, which is a major factor. At the same time, Azerbaijan has gained an alternative market for export of oil products, while Georgia has benefited from transit. Of $2 billion that Ukraine has spent on the purchase of crude oil over six months, 500 million accounted for crude oil imported from Azerbaijan. And this was made possible precisely because Azerbaijani-Ukrainian-Georgian corridor operates in an unimpeded manner.

AZERBAIJAN IN GUAM. "Azerbaijan is a very important country in GUAM. This country is becoming more serious guarantor of energy security in the region. Particularly, Georgia fully covers its needs for gas and oil products at the expense of Azerbaijan. Azerbaijan's contribution to strengthening Ukraine's energy security intensifies. But this is not done to spite someone else or to expel suppliers from the market, etc., but simply today it needs to compete for the markets. It is necessary to offer the best conditions, lower prices and better quality. Who does this wins," this is your opinion of GUAM Secretary General Valeri Chechelashvili about Azerbaijan's role in the organization.

As known, there is a format "GUAM +", within which GUAM cooperates with countries such as USA, Poland, Czech Republic, etc. And one of the last projects in this regard is the creation and promotion of a unified tourist product of the GUAM countries, designed for Japanese tourists.

According to the tourism project, the GUAM countries are very interested in attracting as many as possible tourists from Japan in the GUAM region. Exactly Japan has been selected as a priority country, based on several principles. Firstly, each year about 20 million tourists travel from Japan. This is a very active tourist market. Secondly the Japanese tourists are a sort of figure, a guarantee that the country meets all the required standards of service, security, etc. The influx of Japanese tourists to the country entails a greater flow of tourists not only from the region, but also from other countries. Another reason for interest is that the Japanese tourists on the flight to 10-15,000 km could not fail to visit 3 or even 4 countries. And since the GUAM countries, being friendly, having partnership relations, are nevertheless quite different, during one trip, the tourists from Japan get an opportunity to get acquainted with very different cultures, traditions, learn 4 completely different worlds in all their diversity.

In this regard, the Baku Declaration on Tourism Development was adopted at the level of heads of agencies and the Action Plan was adopted with concrete measures.

As seen, the economic role of the union for member countries is great and GUAM is ready to more focus on expansion of economic projects. It needs to more involve the business community. In order to promote cooperation between business circles, the Union has created the Business Council of GUAM. It aims to create conditions for a continuous exchange of business proposals, find partners for cooperation, conduct discussions at the business level, discuss problems of economic and legal issues, and propose to the governments of the GUAM member states to remove obstacles that hinder active implementation of business cooperation.

Chaired by the Ukrainian side, 13th Meeting of the GUAM Trade and Transport Facilitation (TTF) Project Steering Committee completed on Nov. 18, 2010 in Kiev. Participants of the meeting were furnished information about realization of the Protocol of Steering committee's previous session, in particular, about aspects of implementation of the project on electronic preliminary informing on transported cargoes on TIR-EPD system (International Road Transport Electronic Pre-Declaration), the course of the implementation of Trade and Transport Facilitation Project in GUAM member states, second phase of joint border operation "TIRA" on the Ukrainian-Moldavian region border, about possible joint projects at bilateral or multilateral levels between customs administrations of GUAM member states in the field of "Electronic customs", as well as creation and functioning of the Regional educational center of World Customs Organization in Ukraine.

GUAM's key task is to enable the four-sided format of cooperation to offer comfortable conditions for realizing national interests of each of four countries. The priority of this organization is simultaneously its weakness, because it unites only four countries and cannot claim at universality of regional cooperation. However, in this stage all four member4-countries have common views and common foreign political interests, which help to consolidate common efforts. GUAM is frequently compared with the Black Sea Economic (BSE) organization, which is a unique platform of regional cooperation, uniting all countries and regions. The difference is that there is no contradiction within GUAM, but obvious partnership and free atmosphere of cooperation.

One can say with confidence that GUAM has strictly defined its political and economical vectors, directed at consolidating the member-countries' interestsв. Indeed, many international organizations pose difficulties in its proper establishment. However, it is clear that in difference to many integration projects in the post-Soviet area, GUAM has good prospects for development and hopes that this organization will give to know as an important regional organization.