Moodys outlines Russias role in global economy RT Business News
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Russias economic pull in the Eurasian Economic Union (EEU) remains strong despite geopolitical tensions and Western sanctions, according to Moodys. The rating agency, however, noted that growing uncertainty is undermining Moscows role as a major diplomatic player and economic hub.
According to the report, the conflict in Ukraine has led Central Asian countries to reassess their trade routes, export markets, and investment sources, as they seek to diversify. This could boost regional economic growth and transform labor markets, Moodys wrote. The conflict has repercussions on the world stage, especially in the ex-Soviet Commonwealth of Independent States (CIS) nations, it added.
The report predicted that increased cooperation and infrastructure development between Central Asian countries will diminish Russias central role, as more diverse regional trade routes emerge as alternatives to the historical hub and spoke model that links Moscow to the former Soviet republics.
We expect Russia's diminishing power on the world stage to reshape geopolitical alliances in the CIS, particularly in Central Asia. China, the US, the EU, but also Trkiye and Iran, will play an increasingly prominent role, Moodys stated.
At the same time, trade between Russia and Central Asia has continued to rise, jumping by 28% in 2022 year-on-year, Moodys said. The report indicated that economic cooperation has been growing within the Russia-led free trade zone.
Russia-led trade bloc adheres to free market rules Putin
Official statistics show that mutual trade between EEU member states has reached a record high of $83.3 billion so far this year.
The EEU, which is based on the Customs Union of Russia, Kazakhstan and Belarus, was established in 2015. It was later joined by Armenia and Kyrgyzstan. This year, Iran sealed a memorandum on free trade with the bloc. The union is designed to ensure the free movement of goods, services, capital, and workers between member nations.
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Thursday, May 25, 2023 at 6:51 am