Kazakhstan International Affairs - The Times Of Central Asia

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Russian Securities Are Leaving Kazakhstan — Reports

The Central Securities Depository of Kazakhstan has urged those in the financial sector to send orders to withdraw Russian securities from their nominal holding by August 1. These statements were reported by RBC, which referenced a notice letter by a Kazakhstani brokerage to its clients and a source within the financial sector, who confirmed the authenticity of the letter. In the letter to clients, the broker informed them that he received a letter from the Kazakhstan depository notifying him about the necessity of completing deals with the National Settlement Depository by the end of the month. Quoted by the broker, the message of the Kazakhstan depository states that, "The Central Securities Depository notifies you that you need to conduct transactions with the participation of National Settlement Depository JSC that are ordinary and necessary for the alienation of debt or shares in favor of non-U.S. persons and not included in the U.S. blocking sanctions list, by August 1, 2024. After this date, the possibility of executing orders by the Central Securities Depository on these financial instruments will be considered, taking into account the peculiarities of possible restrictions.” In the letter, the Central Securities Depository informs clients in advance about possible restrictions and difficulties in executing orders on securities with the prefix RU before the ISIN after the specified date. The Depository also added that when processing orders from clients, the Central Securities Depository will consider the possibility of their execution, considering the risks and consequences that may arise for itself. "In essence, the letter says that they recommend finalizing all settlements and ridding Kazakhstan depository of securities with Russian ISINs. The Kazakhstan depository does not want to see these securities in portfolios," - says Julia Khandoshko, CEO of European broker Mind Money. In mid-June, the US Treasury Department's Office of Foreign Assets Control (OFAC) included the Moscow Exchange, which owns 13.1% of KASE shares, in the Specially Designated Nationals requiring sanctions list. The exact volume of Russian securities held in Kazakhstan is still being determined. However, from March to December 1, 2022, Bloomberg estimates that Kazakh brokers conducted transactions with Russian federal loan bonds totaling $1.4 billion.

Central Asia Kazakhstan Local Politics International Affairs Local Politics Kazakhstan International Affairs Kazakhstan Business & Economy Kazakhstan Business & Economy

Kazakhstan Seeks to Increase Local Content in Oil and Gas Equipment Production

From July 10 to 12, the Kazakhstani city of Atyrau hosted the Oil and Gas Machine Building Forum. The Forum aimed to develop local content and support domestic manufacturers of oil and gas equipment and local suppliers of works and services for the sector. The event also included Open Doors Days for three major oil and gas operators in Kazakhstan: Tengizchevroil, North Caspian Operating Company, and Karachaganak Petroleum Operating B.V. As reported by the Kazakh Ministry of Energy, these three major subsoil users account for 70% of all oil and gas equipment purchases in Kazakhstan. Speaking at the Forum, Vice Minister of Energy Alibek Zhamauov said that both Kazakhstan’s president and prime minister outlined several specific tasks aimed at developing local content in the oil and gas sector. Particular attention, they said, should be paid to increasing the share of Kazakhstani goods, works and services in the sector’s purchases, creating new as well as modernizing existing production facilities, localizing the production of the most popular products in Kazakhstan, as well as moving design offices to the country, with the mandatory involvement of local engineers and design companies. Due to efforts of the Ministry of Energy, in May of this year contracts were signed between Tengizchevroil, North Caspian Operating Company, and Karachaganak Petroleum Operating B.V. and domestic manufacturers for the purchase of locally made oil and gas equipment worth $240 million. Speaking at the Forum, Leyla Gimranova, Deputy Director of the Project Department at Kazakh Invest, emphasized that oil and gas engineering could become a new growth point in developing domestic added-value production and import substitution. She said that last year, Kazakhstan produced oil and gas equipment for $72.7 million and imported such equipment for $1 billion. “This is a significant difference that needs to be reduced. Therefore, we are actively working to identify priority goods for import substitution, the production of which is possible based on existing domestic enterprises," Gimranova said.

Central Asia Uzbekistan International Affairs Uzbekistan Business & Economy Kazakhstan Business & Economy Kazakhstan International Affairs Kazakhstan Business & Economy Uzbekistan International Affairs

Uzbekistan’s Investment in Kazakhstan Reaches Record Levels

The volume of gross direct investment flow from Uzbekistan to Kazakhstan in 2023 was a record $22.2 million, as reported by Zakon.kz. This is the largest statistic recorded since the end of 2005. Last year, Kazakhstan and Uzbekistan implemented several important investment projects. In particular, $71.2 million was invested into the production of Chevrolet Onix cars in the Kostanay region. A metal rolling plant was built in the Almaty region after a roughly $57 million investment. Lastly, a facility to produce various sterile pharmaceutical and hygiene products was established in Shymkent following an approximately $9.3 million investment. The increase in investment offers from Uzbekistan is reported to be related to the positive business environment in Kazakhstan. The report notes that extremely favorable conditions have been created for business in the neighboring country. The current conditions in Kazakhstan effectively protect the rights of investors and thus encourage investments. The governments of Tashkent and Astana recently signed a Treaty to enhance cooperation between the two countries. The countries agreed to increase the volume of mutual trade to $10 billion and expand business relations soon. According to the Telegram channel “Data Hub,” Uzbekistan had become the third largest foreign investor, surpassing China, regarding the number of companies registered in Kazakhstan. These statistics show that Uzbekistan is increasingly becoming an important trade partner for Kazakhstan.

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Law Firm That Helped Johnny Depp Has Another Big Client: Kazakhstan

Two American attorneys who represented actor Johnny Depp in his libel case against former wife Amber Heard have visited Kazakhstan’s Constitutional Court and spoken to Kazakh university students this week. Attorneys Camille Vasquez and Benjamin Chew work for Brown Rudnick, an international law firm that has a client in Kazakhstan: the Ministry of Justice. The firm, whose primary address is in Boston, has been engaged to help the Kazakh ministry in legal processes in Britain and the United States, according to a February filing with the U.S. Department of Justice. In recent years, Kazakh authorities have pursued an international campaign to recover assets that they say were stolen and moved abroad. Vasquez and Chew became familiar faces for many people during the Depp vs. Heard 2022 trial, which was livestreamed and set off a fresh round of debate about celebrity culture and the MeToo movement. A jury awarded $15 million to Depp, who had accused Heard of lying when she said he had abused her, though it also awarded $2 million to Heard in a separate decision. Later, Depp agreed to receive $1 million and pledged it to charity. Vasquez in particular became something of a celebrity herself during and after the trial. She has worked as a legal analyst for NBC News and was elevated to partner at Brown Rudnick, which had helped Depp. Chew joined the firm as a partner in 2018. Vasquez “talked about the importance of personal brand in the court of law and in the court of public opinion” in comments at the International School of Journalism of Maqsut Narikbayev University in Astana, the Kazakh capital, the school said on Wednesday. The school, which opened last year after a presidential instruction, said the lawyer offered tips about embracing identity, creating value, how to “grow” and time management. As the attorney spoke, images appeared on the screen behind her. One showed Depp in his “Pirates of the Caribbean” garb. Vasquez and Chew also visited the Constitutional Court in Astana and discussed gender equality and strengthening women's rights in the judiciary, Tengri News reported, citing the court’s press service.

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Kazakhstan Urges Bulgaria to Utilize Potential of Trans-Caspian Transport Route

Bulgaria, like Kazakhstan, plays an important transit role in the growing trade between the EU, Central Asia, and China. In his speech at the forum “Transport Connection between Kazakhstan and Bulgaria, on July 10 in Sofia organized by the Embassy of Kazakhstan to Bulgaria, Ambassador of Kazakhstan to Bulgaria Viktor Temirbayev emphasized the need for both countries to intensify cooperation in transport and transit by focusing on the development of the Trans-Caspian International Transport Route (TITR). Addressing representatives of Bulgarian transport companies, Ambassador Temirbayev highlighted the fact that Kazakhstan’s location in the center of the Eurasian continent creates favorable conditions for using its transport network for transcontinental routes connecting East and West, as well as North and South. Forum participants were briefed on ongoing efforts by Kazakhstan’s government to increase cargo transportation along the Trans-Caspian International Transport Route, as well as the development of a new automobile route for cargo transportation through Turkmenistan, Iran, Turkey and on to EU countries through Bulgaria and Romania. In support, Yassen Ishev, Chairman of Bulgaria’s Scientific and Technical Union of Transport (STUT), stressed the importance of increasing cooperation in transport and logistics and in particular, establishing direct business contacts between the two countries’ transport companies.

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Kazakhstan-EU Transport and Logistics Cooperation

Expansion and strengthening of trade, economic and investment cooperation, and joint projects in transport and logistics with a focus on the development of the Trans-Caspian International Transport Route (TITR), were the key issues of the 15th meeting of ‘Kazakhstan-EU’. Participants in discussions held in Astana on 10 July included Kazakhstan Prime Minister Olzhas Bektenov, head of the Delegation of the European Union to Kazakhstan, Ambassador Kestutis Jankauskas, and heads of diplomatic missions of EU countries in Kazakhstan. During the meeting it was stated that about 85% of goods exported by China to EU countries are transported through Kazakhstan, and TITR provides the most competitive cargo delivery time of 12-15 days. Regarding their interest in unlocking the full potential of TITR, also known as the Middle Corridor, participants noted the establishment of the joint venture, Middle Corridor Multimodal, at the Astana International Financial Centre, and the significant role of the European initiative ‘Global Gateway’, which opens new prospects for investment in the transport industry. To raise their strategic partnership to a new level, all confirmed their commitment to developing and strengthening Kazakhstan-EU trade and economic relations. According to the Kazakh government, the European Union accounts for over 40% of Kazakhstan’s foreign investments and about 30% of foreign trade. In 2019-2023, trade turnover between Kazakhstan and EU countries increased by 36.2%, amounting to $41.4 billion. Last year, EU countries invested $10.4 billion in Kazakhstan’s economy, and in the first quarter of 2024 alone, $2.8 billion.