Kazakh government envisions consolidating local exporters through engaging foreign buyers and state service support

ASTANA – The Ministry of Industry and Infrastructure Development has prepared a three-year comprehensive plan to assist export-oriented domestic enterprises in entering foreign markets.

Photo credit: kapital.kz.

The ministry surveyed more than 300 local non-oil exporting companies and identified nearly 60 percent need financial support in terms of concessional lending, refinancing, subsidies, tax preferences and transportation cost reimbursement and speeding up the value-added tax (VAT) refund process, as well as removing trade barriers abroad.

Authorities will allocate 500 billion tenge (US$1.31 billion) from the state budget, said Vice Minister of Industry and Infrastructure Development Arystan Kabykenov at a Jan. 28 press conference.

The ministry sees a number of opportunities for local companies to invite inspection commissions from China, Iran and the United Arab Emirates (UAE) to certify their products, which it feels should “simplify access to [foreign] markets.” In the same vein, it suggests organising meetings this year between Kazakh producers and large foreign buyers such as Auchan (the European Union, Russia), Metro (China, Middle East, Russia), Migros (Turkey), Vanguard, Wumart (China) and Yonghui (China).

The 2019 agenda includes 15 trade missions and seven trademark-promoting events to enhance service support for exporters. Authorities will ensure the participation of at least 50 enterprises in foreign specialised exhibitions and organise six national stands carrying enterprise diagnostics, including business process analysis, products and product demand, as well as marketing and promoting products abroad, said Kabykenov.

The newly updated export.gov.kz should also ease many time-consuming procedures.

“Every entrepreneur will be able to receive services related to exports, as well as submit an application for participation in trade and economic missions. In addition, there are plans to integrate the portal with leading market places, logistics service dispatchers and an electronic customs declaration system,” he added.

Local businesses should worry less about the language barrier in exporting their products, as foreign technical regulations will be translated into Kazakh and Russian.

Ten additional trade mission centres in Central Asian countries, China, Turkey and the UAE will facilitate the work.

“Today we have only one, while Russia has 57, Belarus has 40 and Uzbekistan has 12. As the experience of these countries shows, after opening in the traditional markets of trade missions, exports have grown three times already in one year. The purpose of these representations is to manually escort Kazakh exporters abroad,” said Kabykenov.

The ministry estimates export earnings will reach 725 billion tenge (US$1.9 billion) by 2021. The main goods should potentially be machine-building industry, food, dairy and construction materials products.

The chief Kazakh manufacturing exporters currently produce steel alloy rods, shaped and special profiles, pipes and seamless profiles and other metallurgy products. Non-oil exports represent 19.6 percent of finished goods, he noted.

Atameken National Chamber of Entrepreneurs certified more than 1,400 domestic producers, including 368 export-oriented enterprises.

Total exports grew by 26.4 percent last year. Exports in the non-primary sector increased by 3 percent to nearly $14.5 billion.