December 2021 will mark 30 years since the Commonwealth of Independent States (CIS) was founded. The “Agreement Establishing the Commonwealth of Independent States” signed by the leaders of the Byelorussian SSR, the Russian SFSR, and the Ukrainian SSR on December 8, 1991, gave birth to the organization [Prlib.ru, 1991]. On 21 December 1991, the heads of Kazakhstan, Uzbekistan, Turkmenistan, Tajikistan, Kyrgyzstan, Moldova, Armenia, and Azerbaijan signed the Alma-Ata Protocol [Web.archive.org, 1991], which created the framework and legal terms of the organization. By May 1994, 12 out of 15 Former Soviet States became members of the CIS, which was founded to serve as a regional intergovernmental organization that would promote political, military, economic, and socio-cultural cooperation between the newly formed states.
Dynamic political, economic and socio-cultural shifts that actively transformed the Post-Soviet states during 1990s fueled the motivation of the newly formed states, except for the three Baltic countries, to participate actively in the new organization. The Post-Soviet countries necessitated urgent solutions for acute socio-economic problems and, at the same time, had to carry out transition reforms. Despite the political independence of the member-states and different political priorities, the economies of the Post-Soviet states were highly interconnected, which required intense interaction and cooperation. These and other factors cemented the relations inside the CIS fueling the enthusiasm the member-states to take joint actions within the framework of the organization. Therefore, there has been a period of dynamic formation of the organization during 1990s. Yet in March of 1992, the heads of parliaments of Armenia, Belarus, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan signed an agreement on the Inter-Parliamentary Assembly of Member States of the CIS, which was established as an advisory institution to discuss issues and consider draft documents of mutual interest [Cis.minsk.by, 2010]. In January of 1993, the charter of the CIS was adopted in Minsk, which outlined all the main goals and norms of relations between member-states [Cis.minsk.by, 1993]. In October of 1994, the member-states established an Interstate Economic Committee of the Economic Union that was designed to regulate economic relations and agreements as well as integration processes within the commonwealth [Files.stroyinf.ru, 1994]. It is important to note the CIS did not aim to enhance economic integration but to regulate integration processes that happened to be due to different reasons.
The trends inside the CIS gradually started to change in 2000s and centrifugal forces started to prevail over centripetal movements. Several reasons indicate that there was a breakdown in the development of geopolitical and economic processes in the Post-Soviet territory that happened to be encompassed by the CIS. The momentum gained in the beginning of the formation of the CIS was practically lost by the middle of the first decade of the 21st century. It is important to note that it would be partially misleading to explain the decline of the CIS by the fact of some of the CIS member-states being pulled by another integration project, namely the EU. Out of six CIS members-states that are formal members of the Eastern Partnership initiative, only Georgia, Ukraine and Moldova are actively working on implementing the European integration. Although Georgia and Ukraine have practically abandoned the CIS, Moldova is still a full member of the organization. Moreover, in August 2005, Turkmenistan, which does not participate in any other integration projects, changed its status from full member to an associated observer of the CIS [Ria.ru, 2009].
It is worth mentioning that the CIS as a whole has been losing its economic grounds over the last decade. One of functions of the CIS is the development of economic cooperation through trade liberalization. All current members of the organization except for Uzbekistan, Azerbaijan, and Turkmenistan have signed the FTA that implies reduced import tariffs for a wide range of commodities. The fact is that the mutual trade among the current members of the CIS FTA ($105.1 billion) makes only 11.9% of their total trade ($883.5 billion) [UN Comtrade, 2021]. In other words, the CIS members are mostly outward-oriented in terms of trade and the difference between mutual trade and trade with the rest of the world grows over time. From 2010 to 2019, the sum of the total external trade of the CIS FTA members has grown by 23.8%, while the mutual trade between the member-states has increased only by 6.9%. Hence, the CIS members are opening up to other markets more than developing mutual trade. This trend also reflects the structure of the economies of the members of the commonwealth that made little progress in the diversification of their exports since the collapse of the USSR.
High vulnerability to prices of exports of primary commodities was one of the main factors that brought down the economic growth in CIS during recent years. The 12 states that were initially members of the organization have seen rapid economic growth rates. From 1998 up until the crisis of 2008, the CIS economies have grown at about 8% annually on average, compared to the world average of 3.3% and other middle-income states that had 5.5% of annual GDP growth. However, the growth rates have sharply reduced after the crisis of 2008 and over the last decade, it was on average at 3.5% of annual GDP growth. This is still higher than the world average (2.5%) but considerably lower than in other middle-income states (4.7%). Hence, in general, we can note the prevalence of disintegration patterns in terms of trade and economic deceleration in the CIS over the last ten years [World Bank data, 2021].
On the other hand, the economic cooperation between the CIS member-states is not dwindling either, at least in institutional terms. In July 2010, after years of negotiations, Russia, Belarus and Kazakhstan launched a Customs Union [Interfax.ru, 2010] that eventually became the Eurasian Economic Union (EAEU) in 2015. In the same year, two other countries of the CIS (Kyrgyzstan and Armenia) became members of the EAEU [Eurasiancommission.org, 2015]. Despite the two regional structure not being formally related, it shows there is economic integration activities going on within the same geographic area but in different institutional frameworks. Hence, the decline of the CIS during the last 15 years should neither be understood as an indicator of regional integration nor of disintegration.
The processes in the CIS that took place during its first decades of existence indicate that the organization served to a great extend as a tool to solve immediate problems of economic transition and social tensions in member-states. The organization evolved quickly involving 12 out of 15 Post-Soviet states mainly thanks to low transaction costs and the similarity of socio-economic situation these countries found themselves in after the collapse of the USSR. The role and importance of the CIS has been gradually declining after 2000 as majority of the member-states have firmly stepped on transition paths and formulated their geopolitical priorities. However, the CIS should not be considered as the sole indicator of cooperation and integration among Post-Soviet states that are still in their early stages of formation and nation building. Besides the CIS and other existing regional organizations in this territory, we can expect the emergence of other regional structures promoting various forms of cooperation and integration between the Post-Soviet states in the future.
Cis.minsk.by (1993). Charter of the Commonwealth of Independent States. Retrieved from https://cis.minsk.by/page/show?id=180. Accessed on 28.04.2021.
Cis.minsk.by (2010). Inter-Parliamentary Assembly of Member States of the Commonwealth of Independent States (IPA CIS). Retrieved from https://cis.minsk.by/page/show?id=204. Accessed on 28.04.2021.
Cis.minsk.by (2021). Results of the meeting of the Council of CIS Foreign Ministers. Retrieved from https://cis.minsk.by/news/18518/itogi_zasedanija_soveta_ministrov_inostrannyh_del_sng_%282_aprelja_2021_goda%29. Accessed on 23.04.2021.
Comtrade.un.org (2021). International trade data. Retrieved from https://comtrade.un.org/data/. Accessed on 24.04.2021.
Eurasiancommission.org (2015). Kyrgyzstan joined the Eurasian Economic Union. Retrieved from http://www.eurasiancommission.org/ru/nae/news/Pages/12-08-2015-1.aspx. Accessed on 24.04.2021.
Files.stroyinf.ru (1994). Agreement on the Creation of the Interstate Economic Union Committee. Retrieved from https://files.stroyinf.ru/Data1/1/1266/index.htm. Accessed on 28.04.2021.
Interfax.ru (2010). Customs Code between Russia, Belarus and Kazakhstan entered into force. Retrieved from https://www.interfax.ru/business/144140. Accessed on 28.04.2021.
Prlib.ru (1991). The “Belovezh Agreement” signed. Retrieved from https://www.prlib.ru/history/619792. Accessed on 28.04.2021.
Ria.ru (2009). Commonwealth of Independent States. Retrieved from https://ria.ru/20090522/171962452.html. Accessed on 24.04.2021.
Web.archive.org (1991). Alma-Ata Declaration. Retrieved from https://web.archive.org/web/20180808213727/http://gaidar-arc.ru/databasedocuments/theme/details/2880. Accessed on 24.04.2021.
World Bank data (2021). GDP growth (annual %). Retrieved from https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG. Accessed on 24.04.2021.
Note: The views expressed in this blog are the author’s own and do not necessarily reflect the Institute’s editorial policy.
Kanat Makhanov is a research fellow at the Eurasian Institute of the International H.A Yassawi Kazakh-Turkish University. He holds a BA in Business Economics from the KIMEP University from 2012. In 2014 he earned his Masters degree in Economics from the University of Vigo (Spain), completing his thesis on “Industrial Specialization in autonomous regions of Spain and Kazakhstan”. His main research interests are Spatial Economics, Economic Geography, Regional Economics, Human and Economic Geography.