The issue has been discussed at the meetings between the Ukrainian leadership and Russian President Vladimir Putin during his working visit to Ukraine on Saturday.
Ukrainian President Viktor Yushchenko called the creation of a free-trade zone in the CES framework a priority in Russian-Ukrainian relations.
"Every year, the deficit in the trade sphere causes a 20-30% decrease in our trade and economic relations. We are forced to search for other markets to sell our produce," Yushchenko conceded during a joint press conference with Putin in Kiev.
In order to re-establish the full scope of trade relations between Russia and Ukraine, the Ukrainian leader stressed, we need to create a free-trade economic zone in the framework of CES.
During the meeting with Vladimir Putin, Ukrainian Prime Minister Yulia Timoshenko suggested that Russian and Ukrainian governments should conduct a joint discussion of the plan to create the common economic space.
She underlined that the Ukrainian government and the Ukrainian president stand for the CES concept acceptable to all interested parties.
In his turn, Putin confirmed Russia's willingness to create the CES, although he admitted that it had not been a Russian initiative.
"We waited patiently, considering the known political events in Ukraine. But now, when the situation stabilized, we should approach this subject closely," the Russian president stated.
He underlined that the creation of the CES does not pursue political goals. In his opinion, among all issues related to the creation of the CES, the most acute is the formation of a unique supra-national governing body - the Tariffs Committee.
"We are taking into consideration the possibilities that can be realized by economies of Russia, Ukraine, Kazakhstan and Belarus. In particular, to minimize the costs and to make the economies of our countries competitive," Putin stated.
At the same time, the Russian president considers it wrong to set off Ukraine's participation in the CES against its movement toward the European Union.
During the Russian president's visit to Kiev, the sides also discussed the issues of bilateral relations. Putin and Yushchenko agreed to adopt the Russian-Ukrainian action plan for 2005 in the near future.
The leaders also reached an agreement to dissolve the Russian-Ukrainian committee in its former composition and create a new intergovernmental commission Putin-Yushchenko.
According to Yushchenko, the committee will consist of four sub-committees -- on cooperation in the sphere of defense, on international relations, on economic cooperation and on humanitarian issues.
Speaking about demarcation of borders between Russia and Ukraine, the Russian leader stated that this problem must be solved on the basis of existing agreements.
"There are prior agreements and fundamental documents, which will allow us to make additional steps toward the solution of Azov-Kerch border issues. This issue must be discussed at the expert level. I am sure if the sides are willing to reach agreements on this issue, they certainly will," Putin underlined.
Yushchenko announced he suggested during the meeting with Putin to set new borders in the Azov Sea region according to demarcation lines that existed in Soviet times.
"We discussed the demarcation of the borders along the Azov Sea coastline and suggested to the Russian side to acknowledge the demarcation of borders that existed during the Soviet era," Yushchenko stated.
In his opinion, Ukraine and Russia are close to a breakthrough on the issue of demarcation of the Azov Sea basin. At present, Yushchenko underlined, the demarcation of land borders ceased to be a controversial issue.
