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ONLINE DOCUMENT: EX-SOVIET ECONOMIES: NOT VERY COMMON, NOT MUCH MARKET

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The closed Soviet economy was a common market in the extreme. Its breakup into 15 separate parts took a heavy toll, and attempts by some of the now-independent countries to glue the economic bits back together are proving difficult.

The favored means is a customs union, founded last year by Russia, Kazakhstan and Belarus and joined in March this year by Kyrgyzstan, under which member countries pledge to phase out import and export barriers, coordinate economic policy and work toward a common currency.Others are considering joining. Their goal: to reverse the decline in inter-republic trade, which fell 26 percent last year.

Central European and Baltic countries have managed to shift trade winds, which has produced export-led growth. But the ex-USSR countries have been less successful on both counts. The customs union suggests some governments might be increasingly eager to soften the blow on their closely knit economies using other means.

Kazakhstan, the oil-rich central Asian state, pushed hardest for the deal. Trade with Russia has grown 50 percent since the union was formed. Its staple exports - oil, gas, grain and metals, which in theory are to get better access - are four times Russian imports.

Belarus is another enthusiast. There, large industrial giants see their future in reclaiming supply and sale markets in Russia.

Already there have been problems. Last month Belarussian President Aleksander Lukashenko attacked Russia for not honoring its obligations under the customs union; he claimed it never wrote off his country's gas debts, even though Moscow's troops aren't charged for being based in his country.

While Belarus wants a handout, Kazakhstan appears to be playing the political game. President Nursultan Nazarbayev earlier this year parlayed his warm support for Russian President Boris Yeltsin and the union into Russian agreement on a coveted new oil pipeline that could unlock Kazakhstan's rich reserves.

There also have been a number of unilateral moves that appear to fly in the face of any common economic purpose.

Recently Kazakhstan simply slashed high common import duties on cars, furniture, and machinery - all industries that Russia wants to protect - when Moscow refused to act.

As a result, a wide range of goods are excluded from duty-free trade. And no reliable mechanism has been devised to transfer customs receipts among the members, whose bureaucracies are already notoriously inefficient.

"Life has shown that it's not so easy to balance the interests of all these countries," said Rustem Kuvatov, deputy chairman of the Kazakh customs committee.

Other republics remain suspicious of Russian intentions.

When Latvia, Lithuania and Estonia refused to join the Soviet successor organization, the Commonwealth of Independent States, the trade shock was severe, but they recovered the quickest. All three, and in particular Estonia, quickly found new markets in neighboring Nordic and Central European countries after implementing market reforms.

Though less successful in reorienting trade, Ukraine doesn't see a a customs union as a solution. Officials say it only turns poorer members into raw material suppliers for Russia and guarantees markets for protected Russian manufactured goods.

Ukrainian Deputy Foreign Minister Anton Buteiko said his country wanted closer economic ties with Russia. But he thought it should start with the basics. Even the free trade agreement between Russia and Ukraine - the two largest ex-Soviet countries - "unfortunately does not work," he said, "because our big neighbor excludes 168 products" from duty-free trade.

The various strains are making the customs union nearly impossible to implement. Even the increase in trade has been attributed to growing demand in Russia and generally an economic upturn rather than to the union.

Some Western economists think that might be just as well. The central Asian countries, for example, are noticeably poorer than Russia and have a different economic profile.

Joining a Russian-dominated trade block could stunt growth by forcing them to depend on Russian manufactured goods and limiting access to new markets, they say.

Uzbekistan is a case in point. Over the past few months, the land-locked republic has been under strong pressure from its neighbours to sign up. Diplomats in Tashkent, its capital, expect it to join the customs union before the end of next year.

In a recent study, the World Bank argued that if Uzbekistan were to join the union it would hurt economic reform. It said the country's now negligible trade with the rich industrialized countries would increase five-fold once its high tariffs were reduced and the economy was liberalized.

The countries on Russia's rim also have the farthest to go to find new markets. Russia already has a trade surplus - fed by energy exports to the West - and depends less and less on the ex-Soviet markets. The share of Russian trade with CIS members fell to 14 percent last year, down from about 50 percent four years ago, according to ING Barings, the Dutch-owned investment bank.

Not surprisingly, some neighbors visibly grimaced when a Russian minister urged the other ex-USSR states recently "to resist the expansion of foreign producers" from outside the CIS. That also helps explain the cool reception for a new common market again created on Russian terms.

(Distributed by Scripps Howard News Service.)