International Review: Republic of Kazakhstan
In the new material of International Review series we will talk about a member of the Eurasian Economic Union - the Republic of Kazakhstan. A multinational country with a large territory and low population density, located at the crossroads of Europe and Asia.
Head of the Republic: Kassym-Jomart Tokayev. Capital: Nur-Sultan. Population: 18.9 million people. State languages: Kazakh, Russian. National currency: Kazakhstan tenge. It is a unitary state with a presidential form of government. Executive power is exercised by the government. Legislative functions are performed by the Parliament, which consists of two Chambers - the Senate and the Majilis. Includes 14 regions and 3 cities of republican significance. Ethnic structure of the population: Kazakhs (69%), Russians (19%), Uzbeks (3%), Uighurs (2%), Ukrainians (1%), Tatars (1%), Germans (1%) and others (4%).
Interesting fact: The border between Kazakhstan and Russia is the longest continuous land border in the world
The territory of the country is 2.7 million sq. km, of which most are deserts (44%) and semi-deserts (14%), followed by steppes (26%) and forests (5.5%). There are 8.5 thousand rivers and 48 thousand lakes in the country. The north-eastern part of the Caspian Sea is within the boundaries of the republic. The Aral Sea is divided between Kazakhstan and Uzbekistan. In the north and west, Kazakhstan borders on Russia (the length of the border is 7 591 km), in the east - on China (1 783 km), in the south - on Kyrgyzstan (1 242 km), Uzbekistan (2 351 km) and Turkmenistan (426 km). The total length of land borders is more than 13 000 km.
Mineral resource base. There are more than 5 000 mineral deposits in Kazakhstan, the value of which is estimated at tens of trillions of dollars. The republic ranks first in the world in terms of zinc, tungsten and barite reserves; second - in terms of reserves of silver, lead, uranium; third - for copper and fluorite; fourth - for molybdenum; sixth - in gold, eighth - in reserves of coal, iron ore; ninth in terms of proven oil reserves.
Economy. The economy of Kazakhstan is the largest in Central Asia. Since January 1, 2015, the republic has been a member of the Eurasian Economic Union. According to the Index of Economic Freedom, Kazakhstan is in the top 10 countries of the Middle East and Central Asia, ahead of Saudi Arabia, Bahrain and Azerbaijan. The drivers of the country's economy are industry and trade. They account for 47% of the total GDP of Kazakhstan. The main sectors of the economy: non-ferrous and ferrous metallurgy, chemical and petrochemical industries, mechanical engineering, building materials industry, transport, agriculture.
Interesting fact: Kazakhstan is the largest landlocked state
According to the Institute for Marketing and Sociological Research of Kazakhstan, in 2021, the country's GDP grew by 2.6%. The priority areas for development in 2021 were mining, manufacturing and agricultural industries.
In 2021, the number of enterprises in the Republic of Kazakhstan increased by 10% and exceeded 44 thousand. Most companies are registered in the wholesale and retail trade, car and motorcycle repair, and construction. The largest increase in the number of companies occurred in the following sectors of the economy: real estate operations, healthcare and social services, accommodation and food services. The largest companies according to the Forbes Kazakhstan 2021 rating are:
- KAZ Minerals Plc - operates in open pit copper mines;
- Kazakhmys Corporation LLP – mining and processing of copper ore, sale of precious metals;
- TNC Kazchrome JSC - mining, enrichment of chromium and manganese ore, production of ferroalloys of various grades;
- SSGPO JSC - the largest iron ore company in the country;
- Construction holding BI Group - construction of infrastructure, industrial, oil and gas facilities, as well as residential and commercial real estate;
- Magnum Cash & Carry is the largest Kazakhstani trade and retail network;
- Construction holding Bazis Group - construction of residential, administrative and infrastructure buildings, roads and railways;
- Astana Motors Kazakh Motor Company - sale, service and production of cars;
- Trading network Sulpak (Arena S LLP) - includes 177 outlets;
- Aluminium of Kazakhstan JSC - produces raw materials for the production of aluminum.
Interesting fact: the Russian word “money” comes from the Turkic word tenge - the name of the modern currency of Kazakhstan
Kazakhstan has become one of the leaders in cryptocurrency mining in recent years. Since 2019, the share of Kazakhstan in the global bitcoin mining has increased 13 times and reached 18%. This is second only to the USA. Since the beginning of 2022, the budget of Kazakhstan has received more than $1.5 million in royalties from mining companies. For many years, China has been the optimal place to mine beacon due to the large amount of cheap electricity. However, in September 2021, after the Chinese government introduced a complete ban on operations with cryptocurrencies, companies relocated to other countries, including Kazakhstan and the United States (Texas).
FOREIGN TRADE OF KAZAKHSTAN 2021: IMPORT AND EXPORT
In 2021, as the economy recovers from the COVID-19 pandemic, exports of goods from Kazakhstan increased by 30% to $57 billion. The main exports were oil products and fuels, precious or semi-precious stones, precious metals, iron and steel, ores, slag and ash, copper and its products, organic chemicals, crops.
Interesting fact: Kazakhstan is one of the top ten world grain exporters and one of the leaders in the export of flour
Imports of goods in 2021 increased by 5.6% compared to 2020 ($2 117 841 thousand) and amounted to $45.6 billion. Main import items:
- machines and equipment;
- iron and steel and articles thereof;
- clothing and accessories;
- plastics and products from them;
- pharmaceutical products;
- mineral fuels, petroleum products and products of their distillation.
The trade balance for 2021 is formed with a surplus. Kazakhstan's exports exceeded imports by $20 billion. Leading trade and economic partners of Kazakhstan: Russia, China, European and CIS states.
Gross domestic product. The volume of the gross domestic product of Kazakhstan for 2021 amounted to 82 trillion 207 billion 959 million and 700 thousand tenge. Compared to the same period of the previous year, GDP increased in real terms by 4.1%. According to the April World Economic Review from the IMF, Kazakhstan's GDP growth in real terms in 2022 will be 2.3%.
Investments. 75% of all foreign investment in Central Asia is in Kazakhstan. Thanks to a comfortable investment climate and flexible tax regulation, more than $370 billion have been invested in the economy of Kazakhstan since 1991. Such data was announced at the Kazakhstan Global Investment Roundtable (KGIR) in 2021.
TRADE AND ECONOMIC COOPERATION OF THE REPUBLIC OF KAZAKHSTAN AND THE REPUBLIC OF BELARUS
The Republic of Belarus provides national treatment for goods from the Republic of Kazakhstan in accordance with the Agreement on the free trade zone of October 18, 2011 and the Treaty on the Eurasian Economic Union of May 29, 2014. Kazakhstan is one of the ten main trading partners of the Republic of Belarus. In 2021, the trade turnover exceeded $1 billion, up 32% compared to last year. The basis of trade is Belarusian export - $0.9 billion. Over the year, it grew by 25%. Imports over the same period increased by 83% to $0.18 billion. The main positions of Belarusian exports:
- engineering products;
- meat and dairy products;
- furniture products;
- food products from meat, fish;
- wood and products from it;
- plastics and products from them.
The basis of imports build:
- black metals;
- means of ground transport;
- zinc and products from it;
- products from ferrous metals;
- machines and equipment;
- track and signal equipment;
- fruits, nuts, fresh melons, watermelons and papaya.
The commodity distribution network of Belarusian enterprises in Kazakhstan includes 40 entities, as well as more than 170 dealer network entities. There are 7 joint assembly plants of Belarusian machinery and equipment (MTW OJSC, Gomselmash OJSC, MAZ JSC, Bobruiskagromash UKH OJSC, etc.). In 1996, the Intergovernmental Belarusian-Kazakh Commission on Trade and Economic Cooperation was established.
TRADE AND ECONOMIC COOPERATION OF FEZ RESIDENTS WITH KAZAKHSTAN
In 2021, the trade turnover of FEZ Grodnoinvest with the Republic of Kazakhstan amounted to $25.1 million (growth rate - 136%), including exports - $22.7 million (share - 90%, growth rate - 151%), imports - $2.4 million (growth rate - 71%). In total, $700 thousand of foreign investments were attracted from Kazakhstan.
Main positions of export:
- fibreboard and chipboard
- furniture and parts thereof;
- gas cylinders;
- gas meters;
- harvesting machines;
- products of the chemical industry.
Main positions of import:
- cotton fiber;
- accessories for machine tools.
Potential investors are offered the implementation of greenfield and brownfield projects, cooperation with the current residents of FEZ Grodnoinvest in the trade, economic, investment, and production sectors. To do this, within the framework of the special legal regime of FEZ, the necessary tax and customs preferences and benefits are provided, land plots are provided free of charge and without an auction.