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Inaugural Meeting of Kazakhstan-Saudi Business Council Held in Riyadh

The first meeting of the Kazakhstan-Saudi Business Council took place on December 21st, 2023, demonstrating the deepening diplomatic and economic relations between the two countries. This event was organized by the Embassy of Kazakhstan to Saudi Arabia and the Federation of Saudi Chambers, as part of the 6th session of the Intergovernmental Committee between the two nations. In attendance were the Ambassador of Kazakhstan to Saudi Arabia, Berik Aryn, and Co-Chairman of the Business Council and General Director of GreyWolf Management LLP, Kanat Kudaibergen. Representatives from 46 Kazakh companies also participated in the meeting. Saudi Arabia was represented by the Ambassador of Saudi Arabia to Kazakhstan, Faisal Al-Qahtani, Co-Chairman of the Business Council and CEO of Alrajhi International Investments, Ahmed Al-Dakhil, as well as representatives from the Federation of Saudi Chambers and over 40 Saudi company managers and representatives. The establishment of the Kazakhstan-Saudi Business Council was formalized through an agreement signed between the National Chamber of Entrepreneurs of Kazakhstan, Atameken, and the Federation of Saudi Chambers during the Astana International Forum in June 2023.

Quality of Communications Checked in Multiple Regions

The results of monitoring the quality of mobile communications in the cities and districts of Nurek, Dangara, Vose and Kulyab were presented to the Head of the Communications Service of Tajikistan, Bek Sabur, who arrived on a working visit to the Khatlon region. His visit is connected to the implementation of a decree from the President of Tajikistan "On measures to expand non-cash payments." According to various sources, the level and quality of communications do not meet the requirements. The press service of the Tajik Communications Service reported that Sabur, together with specialists, tested mobile communications in Nurek, Dangar, Vos and Kulyab. "The main purpose of the trip is to determine the accuracy of coverage of base stations in populated areas and identify problems," the press service stated. As a result of the technical inspection, it transpired that not all areas meet the quality requirements for communications. In addition, operator coverage was weak in some places. "The management of the Communications Service ordered providers to install additional stations at the same time as updating the existing ones," the department noted, adding that Sabur held a meeting with the residents of Khatlon to get their opinion on the level and quality of mobile communications. Sabur's visit followed reports received from all over Tajikistan about the low quality of mobile operator services. Tajiks often complain about slow Internet and poor communication. One of the main reasons for this is the lack of infrastructure development. It is also affected by poor energy supply and insufficient development of modern communication technologies in the country. As a result, a significant part of the population has difficulty accessing the Internet. Another problem is the lack of investment in the country's telecommunications industry, although this is slowly being corrected. For example, Tajikistan and China recently signed an agreement that provides for the supply of Chinese equipment to the Republic, which will help improve the quality of the Internet. Tajikistan has also agreed to cooperate with two Russian companies - PITER IX and Digit – in this area. Sabur instructed officials and mobile companies to urgently eliminate the identified shortcomings in order to provide all regions with stable communications and Internet following the Presidential decree.

How Will Free Trade Zone Between EAEU and Iran Affect Kazakhstan?

The free trade Agreement between the Eurasian Economic Union (EAEU) and Iran will ensure an increase in annual mutual trade to U$18-20 billion in the near future, Andrey Slepnev, a member of the Board for Trade of the Eurasian Economic Commission said during a briefing. The free trade agreement between the EAEU and Iran is scheduled to be adopted on December 25th 2023. “Iran is a large market, our neighbor, and a key country in the international North-South transport corridor,” said Slepnev. “We consider this new agreement as one of the elements of this corridor." Slepnev stated that currently trade between EAEU countries with Iran is carried out, among other things, within the framework of the interim agreement adopted in 2019, which covers about 360 commodity items. But even this has made it possible to double mutual trade in three years, from $2.5 billion to more than $5 billion, and in 2022 to bring it to $6.2 billion. “The conclusion of a full-scale agreement will allow us to double trade in a short time. The first target we are focusing on is $18-20 billion, which is quite realistic to achieve in the foreseeable future," said Slepnev, adding that implementation of the agreement will be carried out on the basis of the WTO. For this purpose, work will be carried out on the harmonization of regulations, since Iran is not a WTO member. In addition, the parties will strive to increase the volume and channels for making payments in their national currencies. “In Kazakhstan, we see prospects for the supply of traditional Kazakh products to Iran; first of all, wheat, barley, agri-food products, metals, and chemical products. This agreement will allow Kazakhstan to increase its presence in the Iranian market," he added. Slepnev stressed that the expansion of the EAEU trade partnership with third countries will make it possible to use and actively develop the transit and transport potential of EAEU countries. Trade with Iran naturally involves the use of the North-South corridor, and will also contribute to the communications in the East-West corridor, which runs through the countries of Central Asia and Russia. “The demand for these intercontinental transport corridors is constantly increasing in the context of international tension. Economically, we live in a time when the one who is faster wins, so our advantage is speed and convenience," Slepnev concluded.

Kazakhstan Launches Construction of New Railroad to China

The Prime Minister of Kazakhstan, Alikhan Smailov, via a teleconference on December 20th officially inaugurated the construction of a new railway line, Bakhty-Ayagoz, with a total length of 272 km in the Abay Region of southern Kazakhstan. The project is being implemented upon the instruction of President Kassym-Jomart Tokayev to increase the transport and transit potential of Kazakhstan. The project also involves the opening of a third border crossing with China, Bakhty-Chuguchak. The railway line will increase the throughput capacity between Kazakhstan and China from 28 million to around 48 million tons, lessen the burden on the southern checkpoints, and attract additional volumes of transit. It is planned that the double-track line will begin operating in 2027. The large-scale project will be realized with the participation of a private investor on PPP principles. During the ceremony, the Prime Minister stated that last year Kazakhstan's railroads transported the largest volume of cargo since the country’s independence, which amounted to 245 billion tons/kilometer. These rates have been maintained in the current year, despite the geopolitical situation and infrastructure constraints.[/vc_column_text][vc_single_image image="12823" img_size="full" el_class="scond-image" parallax_scroll="no" woodmart_inline="no"][vc_column_text woodmart_inline="no" text_larger="no"]"Over the past five years, the volume of transit container transportation has grown 3.2-fold. Existing transit corridors are being expanded, and new ones are being opened. The Trans-Caspian International Transport Route, North-South and Southern corridors have become particularly relevant," Smailov said. At the same time, the throughput and infrastructure capacities have reached their peak. To address this strategic issue, a decision was made to implement a number of infrastructure projects in the rail industry. The new line is expected to help increase Kazakhstan's exports and the transit of goods from Russia to China and back.

Kazakhstan and Saudi Arabia on Path to Strategic Partnership

Kazakhstan and Saudi Arabia on Path to Strategic Partnership On December 20th, the sixth meeting of the Kazakh-Saudi Intergovernmental Commission on Trade, Economic, Scientific, Technical and Cultural Cooperation (IGC) was held in Riyadh. The co-chairs of the Commission are Deputy Prime Minister-Minister of Foreign Affairs of Kazakhstan, Murat Nurtleu, and Saudi Minister of Investment, Khalid bin Abdulaziz Al-Falih. As part of the IGC meeting, a Kazakh-Saudi investment round table was organized with the participation of over a hundred business representatives from the two countries. Opening the event, Foreign Minister Nurtleu noted the strategic importance of intensifying cooperation between the public and private sectors of the two countries. The minister drew attention to the enormous potential of the Saudi market for strengthening trade and economic relations, as well as the unlimited prospects for expanding investment partnerships. Nurtleu stated that both countries have significant opportunities to further deepen contacts in such sectors as green energy, food security, transport and logistics, mining, petrochemicals, agriculture, finance, and tourism. Saudi co-chairman of the IGC, Khalid Al-Falih drew attention to the interest of the Kingdom’s leadership in strengthening a diverse array of ties with Kazakhstan, which is considered the leader of the Central Asian region. “Kazakhstan is the largest country with a vast territory, rich natural resources and human capital. It is extremely important for us today to bring relations with your country to the most serious level, which involves a confidential political dialogue, mutually beneficial trade and economic ties, as well as large-scale investments in your economy,” said the Saudi minister. The event also featured speeches from the heads of over thirty large companies in the Kingdom, including such giants as Saudi Aramco and ACWA Power. The latter is already starting to implement renewable energy projects in Kazakhstan. The parties agreed to open a joint innovation hub early next year, which will allow startup projects in Kazakhstan to gain access to the markets of the Middle East and North Africa, and will help promote the brand of Kazakhstan as an IT country.

Mutual Direct Investments Among Central Asian Countries Growing

Mutual Direct Investments Among Central Asian Countries Growing On December 19th, the Eurasian Development Bank (EDB) said it is continuing its series of EDB Monitoring of Mutual Investments (MMI) publications. The MMI encompasses a database of investment projects, containing detailed information on mutual direct investments in Eurasia, covering Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, the Kyrgyz Republic, Moldova, Russia, Tajikistan, Turkmenistan, Uzbekistan, and Ukraine. EDB analysts observe that the Eurasian countries’ FDI stock reached U$48.8 billion in mid-2023, following a 5.4% increase in 2022, and with continued growth in 2023. Kazakhstan reinforced its status as the regional leader in terms of inward mutual direct investment stock, with a share of 27.2% as of June 2023 against 26.6% in 2021, followed by Uzbekistan (19.8%), Belarus (12.0%), Russia (9.8%), and Azerbaijan (8.7%). EDB researchers highlighted that FDI stock within Central Asia totaled U$1.1 billion by the end of 1H 2023, marking a 1.8-fold increase compared to 2016. The key areas of mutual capital investments are extractive industries, manufacturing, and financial services. The leading domestic investors in the region are Kazakhstan and Uzbekistan. In the medium term, uncertainties may persist in the dynamics of Eurasia’s mutual investments. EDB analysts note the following factors that will shape medium-term trends in mutual investments: The “neighborhood effect” - the share of Eurasian Economic Union countries in Eurasia’s mutual investments will continue to grow; Dynamic growth in manufacturing. Commencement of production of higher added value products in the countries of the region will be the main driver of growth; and Greater attractiveness of the transport and logistics sector due to shifts in commodity flows and Central Asian countries’ focus on developing dry ports, logistics hubs, and distribution centers.