EurActiv.com

EU news and policy debates across languages

05/12/2016

Kazakhstan hails completion of ‘historic’ WTO accession talks

Trade & Society

Kazakhstan hails completion of ‘historic’ WTO accession talks

An Orthodox priest blesses members of the media at the Baikonur Cosmodrome launch pad. Kazakhstan, November 2014.

[NASA HQ PHOTO/Flickr]

Kazakhstan’s president on Monday (22 June) hailed the “new horizons” opening up to his country after the former Soviet state completed nearly two decades of talks on joining the World Trade Organisation.

The energy-rich nation of 17 million people began accession talks in 1996, but the negotiations were complicated by its membership in the Russian-led Eurasian Economic Union, which also includes Armenia and Belarus.

President Nursultan Nazarbayev hailed the completion of the talks, saying his government would continue supporting agriculture even after the country formally becomes the WTO’s 162nd member in December.

“This is a historic event for us,” the 74-year-old said in a video address to the nation.

“Membership of the WTO will provide our enterprises with access to foreign markets, and consumers with a wide selection of goods and services,” said Nazarbayev, adding that 90 percent of Kazakhstan’s trade was with WTO members.

Talks on Kazakhstan’s entry concluded at a Working Party meeting on June 10 in Geneva, with members of the Working Party celebrating the end of “one of the most challenging negotiations” in the international organisation’s history.

Speaking Monday after the country’s accession package won members’ formal approval, European Union Ambassador to the WTO Angelos Pangratis congratulated the Kazakh negotiating team for behaving “diligently and proactively” during the process.

Kazakhstan is now expected to ratify the accession agreement by October 31, the WTO said.

Rocky road ahead?

Some experts believe accession could be a bumpy ride for an economy that has struggled on the back of depressed prices for its key crude oil export and economic trouble in sanctions-struck neighbour Russia.

“Kazkhstanis are apprehensive about accession as a whole. Results for our neighbours Russia and Kyrgyzstan have been mixed,” economist Tulegen Askarov told AFP.

Askarov, who is president of the Biz Media business journalism centre based in the country’s largest city Almaty, said Nazarbayev was right to be cautious over the country’s agricultural sector, which is “already extremely vulnerable” to foreign imports.

“People understand our economy is not ready to withstand strong international competition. Even membership of the Eurasian Economic Union, a relatively small bloc, has shown that.”

He added however that membership could be a boon for the country’s growing services sector responsible for over half of GDP.

Rakhim Oshakbaev, deputy chairman of the National Chamber of Entrepreneurs of Kazakhstan, noted that the country’s business community is “still waiting” to learn the conditions under which the country is entering the organisation.

“But membership of the WTO is a signal that tells current and future investors that Kazakhstan is prepared to engage in open, civilized international trade in correspondence with accepted rules and principles,” said Oshakbaev.

Kazakhstan’s key trade partners Russia and China have been members of the WTO since 2012 and 2001 respectively.

Politicians in the vast country, which is expected to be represented at a WTO ministerial conference in Geneva in December, have ambitions to see the country among the world’s 30 most developed economies by 2050.

Last month Nazarbayev, who won a five-year term with almost 98 percent of a presidential vote in April, unveiled an ambitious plan dubbed the “100 Concrete Steps” to boost economic growth and make government more accountable, among other objectives.

Background

Kazakhstan is an increasingly important partner of the European Union. Kazakh oil is already flooding Europe and the volume of imports is expected to continue growing in the face of dwindling Libyan supplies.

The former Soviet Republic is the fifth-largest exporter of oil to the EU, after Russia, Norway, Libya and Saudi Arabia. Almost 6% of crude oil imported by the EU in 2010 came from Kazakhstan, according to the European Commission.

Major European companies are active in Kazakhstan's thriving oil industry, and notably in the highly promising Kashagan oilfield in the Caspian region. Gas is also expected to flow soon.

Kazakhstan is also considered a model for the region in terms of inter-ethnic and inter-religious dialogue, with only minor incidents registered so far among its wide variety of ethnical groups. Islam is the dominant religion but radical Muslims are rare, despite Kazakhstan's closeness to much less secular regions, such as Afghanistan and Pakistan.

A new partnership agreement is expected to be renegotiated between Brussels and Kazakhstan.

Further Reading