The slowdown in Russia’s economy is a significant shock for the economies of other CIS countries, a press release of the international ratings agency Fitch says.
"The sharp slowdown in Russia’s economy is a significant shock for the economies of other countries in the Commonwealth of Independent States (CIS) region, but the impact on these countries’ credit profiles varies considerably," Fitch Ratings says.
The Russian economic contraction has a direct impact on CIS countries with close economic links through trade, remittances and investment flows, the analysts explain. "Indirectly, the sharp fall in the rouble has been a major factor in significant currency adjustments across the region," RIA Novosti cited Fitch's message.
According to the ratings agency, Armenia and Ukraine have the most direct exposure among Fitch-rated countries, while the steep fall in oil prices has magnified the fallout in Kazakhstan and Azerbaijan. Russia is the main export market for goods from Armenia and the largest source of foreign direct investment and remittances.
Russia’s slowdown will therefore have a major impact on Armenia’s growth prospects, the analysts say.The disruption of traditionally close economic ties with Russia has been a significant contributor to Ukraine’s sharp economic contraction, according to a press release.
The fall in oil prices increases the effect on the economy of Kazakhstan and Azerbaijan. These countries are also feeling the effects of the devaluation of the Russian rouble, according to the materials of the agency.
