Kazakhstan Seeks to Mitigate Impact of U.S. Tariffs

Kazakhstan is working to minimize the economic damage from newly imposed U.S. tariffs, the highest levied on any Central Asian country. The government is assessing the scope of potential losses and pursuing diplomatic efforts to reverse or reduce the trade measures. A New Front in the Trade War On April 2, U.S. President Donald Trump announced sweeping new tariffs on imports from over 180 countries. Kazakhstan was subjected to a 27% tariff rate. In contrast, most other post-Soviet countries, including Uzbekistan, Kyrgyzstan, Armenia, and Tajikistan, were assigned a 10% tariff, described by the U.S. administration as the “base rate” for countries that “trade fairly” with the United States. Russia and Belarus, whose trade with the U.S. is effectively suspended due to sanctions, were exempt from the increase. Only Moldova, which reportedly imposes a 61% duty on U.S. goods, received a higher rate than Kazakhstan. According to Washington, Kazakhstan applies a 54% tariff on U.S. imports, prompting a reciprocal response, though the methodology behind the administration’s calculations has been questioned by many analysts. Moldova’s higher rate of 61% led to a 31% U.S. tariff. Limited Exposure for Key Exports U.S. President Trump announced a 90-day reprieve for affected countries on April 9, allowing time for negotiations to take place. While the move signals potential flexibility, the economic impact remains uncertain. Kazakh Trade Ministry representative Serik Ashitov stated on April 29 that only 4.8% of Kazakhstan’s exports to the U.S. would be affected by the tariffs. Crucially, major exports, such as oil, uranium, silver, and ferroalloys stand to remain untouched. These commodities account for approximately 90% of Kazakh shipments to the U.S. Despite fears of a broader economic fallout, Kazakhstan's stock market showed resilience in the first quarter of 2025, according to financial news channels. However, the trade conflict has had a deflationary effect on key exports. Oil prices have dropped below projected baselines amid concerns about declining global demand driven by slowing industrial activity, especially in Asia. “We’re observing falling oil prices and reduced global trade. The tariffs are cutting into industrial output in China and other key consumers of raw materials, which affects oil demand directly,” noted a representative of the Kazakhstan Stock Exchange. As of late April, Brent crude was trading at approximately $64 per barrel. Negotiations and Constraints In response, Kazakhstan has initiated diplomatic talks with the United States and plans to raise the issue at the World Trade Organization (WTO). “At present, there is no reason to believe these measures will significantly affect our exports. Nonetheless, we will continue working with American counterparts to mitigate the consequences of these unilateral measures,” Ashitov said during a press briefing. However, analysts caution that Kazakhstan may face structural limits in attempting to resolve this dispute. As a member of the Eurasian Economic Union (EAEU), Kazakhstan does not set its tariff policy independently. “Our customs duties are EAEU duties,” economist Almas Chukin explained. “If we wanted to unilaterally lower tariffs for the U.S., as Israel did, it would require the approval...

Trump Tariffs: A Barrier for Kyrgyzstan, or an Opportunity?

Akylbek Japarov, former head of Kyrgyzstan’s Cabinet of Ministers, has described the United States’ newly imposed trade duties as an "economic earthquake" already reshaping global markets. However, he sees an opportunity for Kyrgyzstan, which faces a comparatively low U.S. tariff rate of just 10%. A Regional Advantage Japarov argues that China has been hit hardest by the new U.S. tariffs. “Following the introduction of duties, Chinese goods are 20-35 percent less competitive, not due to the nominal tariff alone, but because of higher overall costs, disrupted logistics, contract renegotiations, and increased risk premiums,” he explained in a Facebook post. “Part of that market is being freed up, for someone else.” Kyrgyzstan, along with Uzbekistan and Tajikistan, faces a 10% U.S. tariff rate. In contrast, Kazakhstan’s goods are subject to 27% duties. Japarov sees this as a competitive edge that Kyrgyzstan could leverage to integrate into new supply chains, especially while global players are adjusting to the new trade landscape. The former prime minister believes the country is well-positioned geographically, situated between China, the Eurasian Economic Union (EAEU), and South Asia, with low production costs and access to regional markets. While Kyrgyzstan’s total trade turnover stands at around $16 billion, the U.S. accounts for only 4% of that figure. Key exports to the U.S. include shoes, tobacco products, animal-derived goods, and pharmaceuticals. Japarov suggests Kyrgyz businesses focus on re-exports, product localization, and packaging. He calls for investments in logistics and customs certification, and for the government to craft a new export strategy. “While some see a threat, others are building export channels. While some are calculating losses, others are increasing production,” he said. An Opening for Business, Not Policy In an interview with The Times of Central Asia, Sergei Ponomarev, president of the Kyrgyz Association of Markets, Trade and Services, said the new tariffs should be viewed as part of a larger negotiation process. “The trade war has begun. China, the European Union, and other countries are already responding. But the duties have also triggered a wave of global inflation. These are high risks but also great opportunities,” he said. Ponomarev noted that Kyrgyzstan’s limited integration with the global economy means it will likely experience only indirect effects. Still, he pointed to past examples of adaptive trade strategies. Before joining the EAEU, Kyrgyz entrepreneurs often re-labeled Chinese products as “Made in Kyrgyzstan” for resale in Russia. In some cases, Chinese producers even falsely labeled their goods as Kyrgyz to benefit from preferential access to the Russian market. He suggested similar tactics could re-emerge under the current trade environment. “Some businesses may exploit the 10% duty. Chinese goods could be repackaged in Kyrgyzstan or processed through joint ventures,” Ponomarev said. “For example, a sweater could arrive from China, sleeves sewn on in Kyrgyzstan, and the product re-exported as local.” Such methods, he noted, may be feasible in low-tech sectors like apparel, but Kyrgyzstan lacks the skilled labor force needed to replicate this in high-tech manufacturing. Ponomarev concluded that while Japarov’s ideas are...