Post-colonial trade between Russia and former Soviet republics: back to big brother?

3.3 Policy‑related dyadic factors: passive and active
We are particularly interested in whether policy is having an effect in reversing or 
slowing the decline of bilateral trade between Russia and the CIS+ region. However, 
even after taking account of non-policy factors above, it is still the case that policy 
may be affecting trade in ways that are not deliberate.
3.3.1 Passive policy: persistence of use of Soviet era standards
Unlike the Baltic States, which entered the EU, and with the very recent exceptions 
of Ukraine and Moldova (as part of their recent Deep and Comprehensive FTA 
agreements with the EU
17
), Russian and CIS+ products have continued to lagged 
far behind similar products offered by Japan, USA or the EU in terms of quality: 
partly because their goods continue to be based on in the industries inherited from 
the USSR and still use the Soviet production standards (GOSTs). The CEPS (2006) 
report for the EU on Ukrainian–EU trade emphasized the importance of re-branding 
the Ukrainian economy, associated with the adoption of EU standards, which are 
much more widely trusted outside the former Soviet Union. Speaking of GOSTs, 
those production standards were established during Soviet years and for Soviet 
industries. Since the independence of countries which are now part of the CIS+, 
there has been a general failure to update GOSTs to match international produc-
tion standards. Therefore, many products produced under the GOSTs would only 
be recognized in other CIS+ countries. A World Bank (2012) study that quantifies 
the possible impact of further Eurasian Integration of the regions also finds that 
having GOSTs creates one of major obstacles for the members to trade with other 
17
Along with Georgia, Ukraine and Moldova are seen by the EU as the three Deep and Comprehensive 
FTAs, see 
http://www.3dcft as.eu/
.
Economic Change and Restructuring (2021) 54:877–918
895

---

1 3
neighboring regions (i.e., with the EU and China). Central Asia, for example, could 
only offer the same type of goods (materials and minerals in raw form or agricultural 
and intermediate goods that required further processing) that they had produced in 
the late Soviet era. However, to bring their products to the shelves required further 
processing (i.e., large investments to build new industries) for which neither Central 
Asia nor Russia had capital in the early stages of early transition. Since 2000, an 
increase in World prices and demand for energy resources allowed CIS+ members 
and Russia to increase sales to other CIS+ markets without necessarily intensify-
ing skill and knowledge use. Attempts to develop more skill-intensive production 
are still hampered by corruption, political, managerial and marketing inefficiencies 
(Collins 
2009
).