Belarus joins Russia, Kazakhstan in customs bloc

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Belarus on Monday formally joined Russia and Kazakhstan in their efforts to increase economic integration following weeks of wrangling over energy prices.

Meeting in the Kazakh capital Astana, leaders of the three countries signed a declaration bringing into force the joint customs code and effectively launching the three-way customs union from Monday.

"We've concluded a number of international agreements which regulate legal and financial aspects of the union's work," Russian President Dmitry Medvedev said at the meeting, noting that a lot more work lay ahead.

"But taking into account that this is a really advantageous and interesting matter I am convinced we will agree on everything," he said.

Monday's signing came after weeks of wrangling over energy prices, including oil duties, between Moscow and Minsk forcing Russia and Kazakhstan to launch the customs union on a bilateral basis from July 1.

A convoluted energy spat that disrupted European supplies flowing through Belarus dealt another blow to relations between Russia and Belarus last week as the Kremlin cut Belarussian energy supplies and Belarus halted transit of Russia's Europe-bound gas flow in retaliation.

Russia has repeatedly said however that Belarus's leader Alexander Lukashenko was welcome in the customs bloc. Lukashenko had held out until the last minute, notifying his partners of the ratification of the customs code by his parliament only on Saturday.

Prime Minister Vladimir Putin's influential first deputy, Igor Shuvalov, indicated however that Belarus might still bridle at the current agreements and energy prices.

"The Belarussian side still believes that the establishment of the customs union, the single customs territory leads to the abolition of export duties in mutual trading," Shuvalov said.

Belarus, which earns vital revenue by refining Russian crude oil, which it then sells abroad, says it sees no reason to pay full export duties for the oil it receives from Russia.

© 2010 AFP

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