Trade Policy into Integration Blocs and Geopolitical Challenges: The Impact on Forming Supply Chains of Agricultural Products from the EU to Russia

Abstract:

The main problem of the study is to assess the controversial role of trade policy instruments in responding to geopolitical challenges faced by individual countries and groups of countries in the integration associations operating in the rapidly changing system of coordinates of modern international relations. The study substantiates that geopolitical challenges for individual states of such an integration bloc as the Eurasian Economic Union (EAEU) can cause a sufficiently pronounced economic confrontation of their national interests, which leads to contradictory customs effects and a violation of the determinants of economic integration. The dialectics of the relationship of trade policy and geopolitical factors can be illustrated by the example of the transformation of the supply chain system of agricultural products from the EU to Russia in the conditions of the so-called “war of sanctions ”. The depth of integration in the EAEU determines the free movement of goods across the customs territory of the integration association in the context of the elimination of internal customs borders, but in the context of the conflict of national interests of the Eurasian integration partner countries, this situation prevents the effective use of tools of customs control and regulation of trade in the territory of the economic union. The hypothesis of this research paper is that the logistics chains for delivering banned agricultural products due to "sanctions" from the EU to Russia are transformed under the influence of customs effects, adapting to the embargo mechanism established at the national level in a single customs territory, which leads to additional transaction costs for the implementation of the Eurasian integration project and reduces the effectiveness of Russia's participation in it. The paper is prepared with the support of Russian Foundation for Basic Research (RFBR), project  № 18-010-01209 А “Formation of the Organizational and Economic Model of Managing the Customs Effects of the Eurasian Economic Integration and Assessing their Impact on the Mechanism for Implementing the Agreed Agro-Industrial Policy.”

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