Increasing investment attractiveness of CIS countries Research Paper

Increasing investment attractiveness of CIS countries - Research Paper Example As compared to the Baltic and Eastern European nations, the CIS countries experience serious economic crisis and gradual growth in restructuring the productive framework in the respective countries; resulting in the need for increased investments (Shiellis, 2003). The significance of the investments can extend to close the investment gap because of insufficient savings. The external factors that are increased investments include the transfer of managerial skills, technology, processing of information, and a proficient knowledge of sales and marketing.The dissolution of central planning created a market of 100 million consumers in Eastern Europe and 300 million in the successor countries to the USSR. Phyllis says that among the CIS, Russia is having the highest population and several states advocated to embrace the policy of free trade, which permitted imported commodities to meet the local demand. As a result, the imported commodities become wide during the first years of change as t he people used their savings in buying the western goods and services. Due to the economic crisis and escalating inflation rate immediately after the transition, there was a significant decrease in the savings and lowered incomes resulting in the inability for the local consumers to purchase the western products. On the contrary, foreign investors in Eastern Europe privatized the firms from the government and already began to restructure the industries with the objective of increasing the local production.