The Commonwealth of Independent States (hereinafter – CIS; Russian: Содружество Независимых Государств, СНГ, Sodruzhestvo Nezavisimykh Gosudarstv, SNG; also called the Russian Commonwealth) is a regional organisation with its administrative center in Minsk (Belarus) and Russian as working language. It consists of 9 members (countries of the former Soviet Republics): Armenia, Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan and Uzbekistan; and Ukraine as participating country.

The organization was founded on 8 December 1991 by the Republic of Belarus, the Russian Federation, and Ukraine and marked with the signing of the Agreement Establishing the Commonwealth of Independent States, known as the Creation Agreement (Russian: Соглашение, Soglasheniye). The main goals of the Creation Agreement were aimed at:

  • forming common economic space with free movement of goods, services, labour force, capital;

  • elaborating coordinated monetary, tax, price, customs, external economic policy;

  • bringing together methods of regulating economic activity;

  • creating favourable conditions for the development of direct production relations.

Eight of the nine CIS member states participate in the CIS Free Trade Area, and five of these countries form the Eurasian Economic Union, the Customs Union (Belarus, Russia, Kazakhstan, Armenia and Tajikistan), as well as common market of over 180 million people.  

The CIS free trade area

The creation of the free trade area within the CIS dates back to 1994, but the agreements were never signed then. In 2009 a new agreement was initiated to create a FTA and was finally signed in October 2011 by eight of the eleven CIS prime ministers: Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russia, Tajikistan, and Ukraine at a meeting in St. Petersburg. The free trade agreement eliminates export and import duties on a number of goods. An agreement also focuses on such points as the basic principles of currency regulation and currency controls in the CIS.
 
The first incentive of post-Soviet integration is associated with relatively low competitiveness of many ex-Soviet goods compared to foreign ones. If trade barriers are eliminated, many manufacturing industries (textiles, food processing, woodworking, etc.) would find themselves under pressure from cheap imports and a better quality would be completely abolished. Therefore, all CIS countries were interested in creating an economic system of collective protection for national companies, which would temporarily block the way for foreign goods.
 
In addition, the integration is meant to restore and maintain the economic relations of the former Soviet republics, partially lost in the 1990s after the disintegration of a single state. According to experts, without the cooperation ties with other CIS countries, even Russia, one of the more self-sufficient members among the former Soviet republics, is capable of delivering only 65% of production. Without the relationship with Russia Kazakhstan can only produce 10% of the range of industrial products, Kyrgyzstan and Tajikistan can produce less than 5%.
 
Thus, we can say that the creation of the CIS was a reaction to the internal problems of the former Soviet republics and the objective necessity for common action in the modern global economy. 

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