DECISION OF THE SUPREME EURASIAN ECONOMIC COUNCIL

of May 14, 2018 No. 11

About the main reference points of macroeconomic policy of state members of the Eurasian Economic Union for 2018 - 2019

The supreme Euroasian economic council decided:

1. Approve the enclosed main reference points of macroeconomic policy of state members of the Eurasian Economic Union for 2018 - 2019.

2. Recommend to the governments of state members of the Eurasian Economic Union to consider when carrying out macroeconomic policy the main reference points of macroeconomic policy of state members of the Eurasian Economic Union approved by this Decision for 2018 - 2019.

3. The Eurasian economic commission to carry out the analysis of the measures realized by state members of the Eurasian Economic Union in the field of macroeconomic policy and to estimate compliance of such measures to the main reference points of macroeconomic policy of state members of the Eurasian Economic Union approved by this Decision for 2018 - 2019.

4. This Decision becomes effective from the date of its official publication.

Approved by the Decision of the Supreme Eurasian economic council of May 14, 2018 No. 11

The main reference points of macroeconomic policy of state members of the Eurasian Economic Union for 2018 - 2019

This document is developed according to the Agreement on the Eurasian Economic Union of May 29, 2014 (further – the Agreement) and is directed goal achievement, established by the Main directions of economic development of the Eurasian Economic Union approved by the Decision of the Supreme Eurasian economic council of October 16, 2015 No. 28, and also on the solution of the tasks determined by strategic and program documents of state members of the Eurasian Economic Union (further respectively – state members, the Union).

The main reference points of macroeconomic policy of state members of the Eurasian Economic Union approved by the Decision of the Supreme Eurasian economic council of April 14, 2017 No. 7 for 2017 - 2018 were considered by state members when carrying out macroeconomic policy that promoted overcoming effects of influence of negative external factors of previous years and improvement of situation in national economies.

After decrease in economic activity in the Union in 2015 - 2016 in 2017 nablyudalosy gradual recovery. Against the background of growth of the consumer demand and moderate increase in prices for the main export goods of state members in general on the Union growth of production in industrial and agro-industrial production, the growth in volumes of cargo transportation and retail turnover were observed.

As a result of carrying out by the governments and national (central) banks of state members of active economic policy against the background of some improvement of external and internal conditions all state members reached positive rates of economic growth. At the same time growth rates of economies of the Republic of Armenia, the Republic of Kazakhstan and the Kyrgyz Republic appeared above the average world values.

Maintenance of flexibility of the exchange rates of national currencies provided to state members external balance and promoted increase in competitiveness of their export. Significantly the amount of foreign trade in goods grew, at the same time export and import components grow at comparable rates. Even more considerable was increase in amount of mutual trade in goods within the Union where export of products of average and high technology productions grew at higher rates.

Forming of positive economic results was promoted substantially by improvement of macroeconomic situation in the Union. As a result of realization of effective national anti-inflationary measures and accounting of the recommendations of the Eurasian economic commission (further – the Commission) directed to decrease in the rate of inflation in the Republic of Belarus, the Republic of Kazakhstan and the Russian Federation, growth rates of consumer prices in said countries were reduced. At the same time the Republic of Armenia and the Kyrgyz Republic overcame deflation in consequence of realization of accommodative monetary policy and recovery of the consumer demand. As a result of realization of package of measures at the national and integration levels for the first time for the period of existence of the Union observance is fixed by all limiting state members of settlement quantitative measure value of inflation (consumer price index) established by the Agreement. Further state members will continue to direct efforts to maintenance of inflation at steadily low level for the purpose of creating favorable conditions for economic development.

In the budget sphere in 2017 improvement of indicators in the majority of state members was observed. In the Republic of Armenia, the Kyrgyz Republic and the Russian Federation reducing deficit of the consolidated budget of the sector of public administration is fixed, in the Republic of Belarus the consolidated budget is performed with surplus. At the same time, according to the Commission, following the results of 2017 there is risk of excess by the Republic of Armenia, the Republic of Kazakhstan and the Kyrgyz Republic of the quantitative value of deficit of the consolidated budget of the sector of public administration established by the Agreement. Besides, the Republic of Armenia and the Kyrgyz Republic can exceed the measure value of debt of the sector of public administration established by the Agreement which growth was caused by need of financing of deficit of the consolidated budget of the sector of public administration and investment projects.

Ensuring with state members the current budget balance and long-term stability of public finances is necessary condition for carrying out the consistent economic policy aimed at the economic development.

Stimulation of investment activity becomes the most important factor of maintenance of positive economic dynamics allowing to attract additional resources in economy and to increase profitable component of the government budget. In 2017 in state members growth of investment into fixed capital was planned, however public financing of investment projects in the real sector remained at the high level that increased load of government budgets. It is necessary to pursue the active policy directed to stimulation of attraction of private investments into economies of state members first of all due to improvement of business climate in the Union.

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