EU-Kazakhstan relationship remains strong, anticipates continued growth

No organisation is perfect or without challenges. And one which has to meet the sometimes conflicting needs of, at the moment, 28 different countries and well over 500 million people is bound to have both flaws and stresses. But looking at the European Union from outside, it is hard to argue that it has not been a remarkably successful project, helping to deliver what its architects had hoped in terms of peace and prosperity.

The foundations for the EU, of course, were laid when Europe was still recovering from the second devastating war between its countries in a generation. It is a mark of its success, as we have said before, that it is now impossible to believe its member nations could again descend into armed conflict. On the economic front, too, the removal of barriers has been a powerful motor for co-operation, growth and rising living standards.

This success is why the EU was hailed by Kazakh President Nursultan Nazarbayev two decades ago as a model for similar economic co-operation in our region. The Eurasian Economic Union (EAEU), which grew out of his vision, is still in its infancy. But there are signs already that the EAEU can also deliver rewards not just for its members but in providing a wider economic boost.

For as the EU has shown – not least in its strong interaction with Kazakhstan – a successful economic union should not be inward-looking. Economic co-operation is not a zero-sum game but benefits all participants as the history of the partnership between Kazakhstan and the EU confirms.

February marks the 25th anniversary of the beginning of this fruitful story. The establishment of diplomatic relations between Kazakhstan and the EU on Feb. 2, 1993, has become the foundation of a strong and growing economic and political relationship, which has benefitted citizens of all the countries involved.

The European Union is Kazakhstan’s biggest trade and investment partner. It is the major market for the country’s oil and gas, a supply which helps ease its energy security concerns. In all, the EU now accounts for 40 percent of our external trade. It is trade, too, where there remains plenty of scope for growth. In the first 10 months of last year, Kazakh trade with EU countries grew by 23 percent compared to the same period in 2016 and amounted to over $24 billion.

It is the same story on investment. While Kazakhstan has been very successful in attracting funding from a wide range of partners in recent years, direct investment from EU member countries in 2016, at nearly $11 billion was just about half of the annual total. The European Investment Bank, along with other international financial institutions, has also helped fund improvements in Kazakhstan’s economy, including an injection of 200 million euros ($247.3 million) last year to develop our agriculture sector.

Behind all these impressive statistics, too, are hundreds of individual partnerships between European companies and their Kazakh counterparts. More than 6,000 joint ventures across many fields, including major firms as well as, increasingly, small and medium-sized businesses now operate successfully in Kazakhstan.

Kazakhstan’s oil and gas sector is, of course, the area where co-operation is both strong and long-standing. But the recent opening of a Kazakh-French plant for the production of radar equipment – the first such venture in Central Asia – is just one example of new high-tech ventures well beyond the commodities sphere.

There is strong interest from EU companies in the next stage of the modernisation and diversification of the Kazakh economy. Sustainable energy production and use is, for example, an area rich for co-operation as EXPO 2017 underlined. We are seeing more and more joint ventures in engineering and manufacturing as well.

The relationship between the EU and Kazakhstan goes well beyond the purely commercial. Over the last 25 years, the EU and its institutions, as well as individual member countries, have given Kazakhstan strong and welcome support as we made the transition from being part of the Soviet Union to a modern, stable independent nation. In turn, Kazakhstan has earned recognition as the EU’s key partner in the region, working together on shared foreign policy goals.

It is why, before the 25th anniversary was reached, a new Agreement on Enhanced Partnership and Co-operation was drawn up at the official level and has already been operating provisionally since May 2016. (For its full entry into force, the ratification by nine remaining EU member states is required while 19 states have already ratified). The agreement – the first of its kind for a Commonwealth of Independent States country – has also in the last few weeks been overwhelmingly endorsed in the European Parliament.

During the debate over the agreement, European Commissioner for Justice Vera Yurova said the relationship between the EU and Kazakhstan had never been stronger. The history of the last 25 years suggests that there is plenty of potential to deepen and extend this partnership in the years and decades ahead.

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