Commonwealth of Independent States

Key Emerging Markets: Russia, Kazakhstan, Ukraine 

Major Industries: Agriculture, Automobile, Defence, Energy

Growth Industries: Renewable Energy, Healthcare


Commonwealth of Independent State (CIS) was first founded by Russia, Ukraine and Belarus on December 8, 1991 before eight other former USSR-states officially joined CIS on December 21, 1991. Following the departure of Georgia, CIS now boosts of 10 members -  Azerbaijan, Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, Turkmenistan, Uzbekistan and Ukraine. In the past two-years, the region entered a recessionary phase due to a plunge in global oil price and sanctions against Russia, which dragged down Russia’s import demands from the region and reduced remittances from Russia to other CIS members.  

Stability of Region

CIS is a politically complex region to navigate, and remains beset by instability due to underdevelopment and diverse socioeconomic composition. Distrust towards Russia has increased following the annexation of Crimea. Apart from the more widely known conflict between Russia and Ukraine, Armenia and Azerbaijan are set on the course of collision over Nagorno-Karabakh. This comes on the back of rising threat of terrorism in Central Asia and political transition in various countries. However, a bright spot may lie in the rising diplomacy prowess of Kazakhstan, who could play a crucial role in maintaining stability in the region.  


Due to her endowment in natural resources such as hydrocarbons and a wide range of metals, CIS remains largely supported by primary industries. Agriculture sector is another key economic driver for Ukraine and several Central Asian countries. While trade barriers have been lowered through the CIS FTA agreement, the establishment of the Eurasian Economic Union in could further boost regional integration with its targeted creation of common market for the free flow of labour, capital and goods by 2025. Additionally, a successful integration of the Eurasian Economic Union (EEU) and China’s One Belt One Road initiative could propel faster economic growth for CIS region.


As Russia exits a prolonged two-year recession, the region is set to rebound with economic growth forecasts of 1.4% in 2017 and 2.8% in 2018. However, weakness in oil price will continue to act as a drag on short to medium-term economic growth prospect. Therefore, structural reforms to the economy as well as the creation of common markets through the EEU will be crucial to accelerate long-term growth.


© 2019 by SMU Emerging Markets. All Rights Reserved. 

Designed by Shaun Cheong and Apuruv Agarwal.


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