Kazakh Foreign Trade Hits Record High in 2022 as New Challenges and Prospects Emerge

ASTANA — Kazakhstan’s trade turnover broke a historical record in 2022, reaching $134.4 billion, exceeding the pre-pandemic level of $97.8 billion in 2019, according to the Ministry of National Economy.  

Kazakhstan’s trade turnover broke a historical record in 2022, reaching $134.4 billion, exceeding the pre-pandemic level. Photo credit: gokazakhstan.net.

In 2020, the country’s foreign trade reduced by 11.5 percent to $85 billion due to output cuts, lockdowns, and border closures.

Exports in 2022 totaled $84.4 billion, with oil and metals serving as predictable growth drivers. However, experts claim that exports did not reach their maximum potential. In an interview with Kazinform, Ernar Serik, an expert at the Kazakhstan Economic Research Institute, said a rise in commodity and metal prices were mainly responsible for the growth last year.

“Our calculations last year showed that Kazakhstan’s real export growth in the first nine months of 2022 was 3 percent, but the nominal volume climbed by 47.5 percent. This suggests that 44.5 percent of the 47.5 percent rise is due to the price factor,” Serik explains.

The country exported over half (59 percent) of its manufactured goods. In terms of imports, despite relatively slow growth rates, the volume of imports to Kazakhstan surpassed $50 billion for the first time, breaking the previous record of $49.8 billion set in 2013. 

The increase in imports was attributed to an 11 percent rise in the supply of engineering goods to $13.2 billion, vehicles by 44 percent to $6.5 billion, food processing by 19 percent to $4.4 billion, and the chemical industry by 27 percent to $4.1 billion.

The expert associates import growth in 2022 with high global inflation caused by rising commodity prices, pandemic-related restrictions, and Kazakhstan’s investment project implementation and purchasing of investment goods for their needs.

Regarding the top three export leaders in the country, the Atyrau Region dominates with 38.6 percent, the capital Astana is second with 10.6 percent, and the West Kazakhstan Region is third with 9.2 percent. 

In the regional context, the Atyrau Region leads the country’s international trade with 25 percent ($33.8 billion), followed by Almaty with 21 percent ($27.6 billion) and Astana with 11 percent ($14.6 billion).

Kazakhstan’s top trading partners

According to Serik, since 2022, the country has seen progressive changes in trade flows, with China nearly matching Russia in imports.

“The unprecedented sanctions imposed on Russia are already having an impact. Its imports declined by 13 percent in the fourth quarter of 2022, whereas Chinese imports soared by 54 percent over the same period. In terms of exports, we see that many exporters are seeking new markets or new logistics routes that avoid Russian territory, which will have a long-term impact,” he said.

Italy ($13.9 billion) topped Kazakhstan’s exports at the end of last year, with China ($13.2 billion) a close second. Top export destinations for Kazakhstan’s goods and services are Russia ($8.8 billion), the Netherlands ($5.48 billion), and Türkiye ($4.75 billion). 

Serik added that Kazakhstan began to trade more with the Organization of Turkic States, which comprises Azerbaijan, the Kyrgyz Republic, Türkiye, and Uzbekistan, with their share of the country’s trade turnover exceeding ten percent.

The trade turnover with European Union countries was also the largest in recent years, and it keeps growing this year. According to Kazakh Deputy Foreign Minister Roman Vassilenko, the EU makes up roughly 30 percent of Kazakhstan’s foreign trade, with trade volume exceeding $40 billion in 2022.

The EU-Kazakh cooperation is built on the Enhanced Partnership and Cooperation Agreement, which entered into full force in March 2020, covering 29 areas of cooperation, including in the spheres of the economy, trade, and investment, education and research, civil society and human rights, among others.

“Last year, our country launched cooperation in new areas such as rare earth metals, green hydrogen, batteries, transport and logistics potential development, and the diversification of commodity supply chains,” said Vassilenko.

One such industrial project with European partners is a $32-42 billion agreement with the Swedish-German company Svevind to build wind and solar power plants in western Kazakhstan, which is expected to produce three million tons of green hydrogen starting in 2030, meeting one-fifth of the EU’s demand for the product.

Trade turnover of Kazakhstan with the countries of the Eurasian Economic Union (EAEU) reached $28.3 billion in 2022. Exports of goods increased by 24.3 percent to $97 billion, while imports reached $18.6 billion.

In the country’s total foreign trade turnover within the EAEU, Russia takes the greater share of 92.3 percent, followed by the Kyrgyz Republic – 4 percent, Belarus – 3.6 percent, and Armenia – 0.1 percent.

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