Kazakhstan, China Sign $50 Billion Worth of Deals in 2015, Ambassador in Beijing Says

As Kazakhstan and China look back at the year of intensive diplomacy and economic cooperation and plan for next year, we interviewed Kazakh Ambassador to China Shakhrat Nuryshev to provide an in-depth insight into the fact-paced relations and their impact on the two countries.

НА САЙТHow long have you been in China? When was the first time you visited China?

My appointment to the high position of Ambassador of Kazakhstan to China took place in February. This is my fifth long-term visit to China. My first acquaintance with this country, its rich history, culture, language and traditions began with my admission to the faculty of Oriental Studies of Kazakh National University in 1989. In 1991, I was fortunate to be among the Soviet students who came to study at Beijing University of Languages and since then my life has been closely tied to China. From the moment the Kazakh embassy to PRC (People’s Republic of China) was established in December 1992, I worked my way up from the duty officer to the head of the mission.

I am aware of the unprecedented credence that the head of state gave to me to represent my homeland in the country whose role, place and importance in the global order both politically and economically increases every year. I am committed to performing my duties responsibly and to contributing to the strengthening of the Kazakh-Chinese comprehensive strategic partnership.

How do you assess the current state of bilateral relations between Kazakhstan and China?

Our relations with China have deep historical roots and have always been one of the traditional priorities of Kazakhstan’s foreign policy. We will celebrate the 25th anniversary of establishing diplomatic relations between our countries on January 3, 2017. During this period, successive multi-level contacts between the two countries have grown into strong bonds of friendship, good neighbourliness and mutual respect.

Security assurances given to Kazakhstan by China, being a nuclear state in response to our voluntary renunciation of our nuclear arsenal, and the final settlement of the border issue contributed to a significant intensification of political dialogue and mutual trust at all levels. Just over the past two years, the leaders of the two countries have met more than 10 times. This frequency of meetings enables them to compare notes on the most pressing international and regional issues and determine the guidelines of mutually-beneficial bilateral cooperation.
For several years China has remained Kazakhstan’s largest trade partner, whose share in the total Kazakh trade turnover exceeded 20 percent.

In spite of the obvious decline in bilateral trade this year due to the fall in prices for major Kazakh exports, extensive efforts are being taken to diversify products shipped from Kazakhstan. I hope that in the near future we will be able to agree on relevant documents that will ensure an export system of wheat flour, oilseeds, livestock products, soybeans and other agricultural products to the Chinese market. Despite the fact that China is the largest agricultural country today, it is equally interested in importing a variety of organic and eco-friendly agricultural products.

Energy cooperation is developing successfully. The two countries have already established a large network of oil and gas pipelines. Just the other day, we held a commissioning ceremony of the third line (Line C) of the main Kazakhstan-China gas pipeline that connects Turkmenistan, Uzbekistan, Kazakhstan and China.

A significant shift has been achieved in transport cooperation. Through the active use of the joint terminal in the Chinese port of Lianyungang, we managed to significantly increase container shipments from China to Kazakhstan and further to Russia, Europe, Central Asia and the Caspian region. By the end of the year, it is expected to transport 250,000 containers and by 2020 – 500,000.

Currently, we are working diligently to harmonise the draft agreement on water allocation on transboundary rivers. The experts of the two countries within the Kazakh-Chinese joint commission on the use and protection of transboundary rivers established a constructive dialogue which should lead to the final result that would take into account the interests of both parties, including various economic, social and environmental aspects.

Having experience in holding a variety of global events, China has already confirmed its participation in the international specialised exhibition EXPO 2017. We are studying the experience of Shanghai, where EXPO 2010 was held with overwhelming success and was attended by around 73 million people.

As you know, the head of state declared 2017 as the Year of Chinese Tourism in Kazakhstan. In the short term, there are plans to sign an agreement on group tourist trips from PRC to Kazakhstan. I believe that this step will help to attract Chinese tourists to Kazakhstan. Last year, more than 110 million Chinese people travelled abroad and spent up to $140 billion. Development of group tourism will give a major boost to the growth of small and medium businesses in Kazakhstan, the service sector in general and tourism, hotel and restaurant business in particular. We expect that it will also have a positive impact on the EXPO 2017 payback.

Cultural and humanitarian cooperation is deepening every year. This year, our Embassy held Abai Readings, made a presentation of the national game togyz kumalak and translated and organised the screening of the epopee “The Way of the Leader” on China Central Television.
China actively supports Kazakhstan’s initiative to convene the Conference on Interaction and Confidence-Building Measures in Asia, having assumed its chairmanship for 2014-2018, and the convening of the Congress of Leaders of World and Traditional Religions, in which a large Chinese delegation participates on a regular basis.

Traditionally close cooperation has been established through the Shanghai Cooperation Organisation, which contributes to regional security and the promotion of economic and humanitarian cooperation.

How do the two countries interact to align Nurly Zhol, the new Kazakh economic policy, with the Chinese initiative Silk Road Economic Belt?

The initiative to establish the Silk Road Economic Belt (SREB) was first announced by China’s President Xi Jinping during his state visit to Kazakhstan in September 2013 in Astana.

Later it was paired with another idea of China’s leader, the construction of the 21st century Maritime Silk Road, and released as a single concept called One Belt, One Road in March 2015.

It should be noted that this initiative’s objective is a gradual transition from attracting foreign expertise, equipment and technology to the active participation of Chinese enterprises in foreign markets with their own equipment, technology and financial resources. In order to implement this initiative, the Asian Infrastructure Investment Bank with a capitalisation of $100 billion and Silk Road Fund ($40 billion) were created.

The main objective of the SREB is to improve infrastructure and facilitate trade, financial and investment cooperation. Kazakhstan is the first country situated along the SREB. We were among the first countries to express support for this initiative and have already started contributing to it. Our major contribution is the construction of the Kazakh section of a 2,700-km Western Europe–Western China highway, which will be completed this year. It is expected that after the commissioning of the highway, freight traffic on the Kazakh section will reach 30 million tonnes per year.

We look forward to closer cooperation with China in transport and logistics, which will create a solid foundation and favourable conditions for further growth of cooperation in trade and investment.

Given the similarity of the objectives of Nurly Zhol, the new Kazakh economic policy, and SREB, we are considering the creation of a joint working group to agree on a common ground and specific activities.

Hopefully, efforts of the two countries to further align Nurly Zhol and SREB will open new investment opportunities for both Chinese investors in Kazakhstan and Kazakh companies in China.

Throughout the year, China and Kazakhstan have been carrying out extensive work on industrialisation and investment or, as our Chinese colleagues say, on the transfer of production capacity. How is this work being implemented?

The agreement on cooperation in this area was reached between the head of state and Premier of China’s State Council Li Keqiang during his visit to Kazakhstan on Dec. 14-15, 2014.

This work is based on the desire of both parties to render economic development innovation with an emphasis on the promotion of high-tech and knowledge-intensive industries. We are working on creating joint production assets in Kazakh territory. Amid the global economic slowdown, this work is gaining high social importance.

In order to promote cooperation in this area, the two governments set up a mechanism of interaction between the Kazakh Ministry for Investments and Development and PRC National Development and Reform Commission, i.e. industrial and investment cooperation meetings. Since December 2014 we have held seven meetings, resulting in the selection of 45 promising joint projects worth more than $20 billion.

As you know, in accordance with the State Programme for Accelerated Industrial and Innovation Development for 2015-2019 the priority sectors are metallurgy, oil and gas processing, chemical industry, machine building, construction materials and food industry. Foreign investors in these sectors are granted with the greatest public benefits and preferences.

Almost all these industries are covered by the above mechanism of industrial and investment cooperation between Kazakhstan and PRC. Currently, one third of the projects are already in the active phase of implementation, the second part is in the preparatory phase and the third part is in the process of negotiations.

It should be emphasised that all the companies are brand new. We are not talking about the transfer of outdated or used plants and production lines from China. There is an agreement on the training of Kazakh specialists to work with advanced and high-tech equipment in the new facilities.

How do you assess the outgoing year of Kazakh-Chinese relations?

In my opinion, 2015 has been a very intensive year in terms of bilateral contacts. There were mutual visits of the two Presidents and several meetings on the sidelines of multilateral events.

One of the significant events of the year was the Aug. 30-Sept. 3 state visit of the Kazakh President to China and his participation in the parade commemorating the 70th anniversary of the victory in World War II. Following the visit, the two Presidents adopted a joint declaration on a new stage of comprehensive strategic partnership, which, in fact, launched a new era of Kazakh-Chinese cooperation.

This December, we expect the official visit of Kazakh Prime Minister Karim Massimov to China and its participation in the SCO (Shanghai Cooperation Organisation) Council of Heads of Government meeting (Dec. 14). I believe that given the global economic instability, regular contacts at the governmental level are crucial in the coordination of economic and trade cooperation and promotion of the stable growth of the two economies. This year, the development institutions and commercial structures of the two countries signed an impressive investment agreement package worth more than $50 billion, which is definitely positive for the growth of trade turnover between Astana and Beijing.

We established a regular dialogue at the deputy prime minister level as co-chairs of the China-Kazakhstan cooperation committee. Mutual visits of specialised ministers and regional governors became systemic.

All of the above-mentioned facts prove that the two countries are mutually interested in developing a long-term and predictable, comprehensive strategic partnership.

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