Trade liberalization with Asian countries is a key issue on the agenda of Russia and the Eurasian Economic Union’s (EAEU) economic and trade connectivity with the Asia-Pacific region (APR). However, the signing of free trade agreements (FTAs) has traditionally been negatively perceived in both Russia and EAEU partner countries because of the extremely conservative prevailing trade policy. This study simulated the situation of full liberalization of Russian trade in goods with Rep. of Korea (here and after: Korea), Singapore, India, Japan and China to assess the risks of such agreements. The countries were selected on the basis of the current negotiating tracks of the EAEU and the analysis of Russian foreign trade with the APR countries. The simulation was performed using a partial equilibrium model built with the SMART software provided by the World Integrated Trade Solution.

The article highlights key product groups, increases in imports of which can be expected with a complete abolition of import duties by Russia (taking into account sensitive tariff lines). In addition, the authors conclude that in this case, imports of Indian and Korean products will increase by approximately 7.5%, and imports from Japan and Singapore, respectively, by 7% and 6.5% of the cost of imports from these countries in 2016. The simulation showed an 8% increase in imports from China, which in absolute terms exceeds the current level of trade with India and Singapore combined. This confirms the low probability of starting the FTA negotiations with China in short and medium term.

The article was supported by Russian Science Foundation Grant No 17-18-01577 “Developing the Community of Greater Eurasia and Strategy of Russia’s Bilateral Partnership with Countries of the Region”.