TEHRAN (Iran News) – Deputy Prime Minister and Minister of Trade and Integration of Republic of Kazakhstan Mr. Bakhyt Sultanov says the trade volume between Iran and Kazakhstan increased by 84.8% in 2021 comparing to 2020 and reached $440.1m which is not satisfactory due to the existing potentials of both states and it can rise significantly.
Speaking in the 17th Session of the Joint Commission on Economic, Trade, Scientific, Technological, and Cultural Cooperation Between the Islamic Republic of Iran and the Republic of Kazakhstan which was held on Monday at Espinas Hotel of Tehran, Sultanov expressed his gratitude to Iran’s Minister of Agriculture Mr. Seyed Javad Sadatinejad for hosting the session and said this is a great opportunity for both countries to exchange views for finding proper mechanisms to strengthen interactions between Iran and Kazakhstan.
He said that Iran is one of the major trade partners of Kazakhstan and their trade has progressed in recent years. He added that the bilateral trade slumped by 36.9% in 2020 but it bounced back in 2021 with 84.8% growth and reached $440.1m. He reiterated that the figure shows approximately 56.2% growth comparing to the pre-pandemic era (2019).
Sultanov went on to say that the main task in the short term is to keep the positive trade dynamism which needs diversity and expansion of items of goods. He added that Kazakh companies are ready to offer 60% of the processed goods from different industries worth $162.3m in Iran’s market that on the whole they will be products of metallurgy industries ($76.7m), foodstuff ($38.3m) and construction products ($3.6m). He then called for the exchange of the list of potential exporting goods which can be offered in Iran and Kazakhstan markets.
He then noted that both countries should strengthen cooperation in field of access to their countries either in the form of bilateral or in the form of interaction in the framework of the EAEU and broaden it.
He went on to say that today 257 companies with Iranian capitals and 80 joint companies are active in different economic sections of Kazakhstan. He noted that the gross foreign direct investment of Iranians in Kazakhstan from 2015 till the third quarter of 2021 has been just $129.4m, adding that although the figure is positive but it does not match with the investment potentials of the two states.
Sultanov then called for the launch of a Kazakh-Iranian commercial council, adding that this platform can create the ground for dialogue among the businesses with skirting the intergovernmental process. He then pointed to the importance of the transportation industry and logistics in developing bilateral cooperation, adding that Kazakhstan attaches great importance to the Kazakhstan-Turkmenistan-Iran railway. He went on to say that with the launch of this railway the export volume has become fivefold and it can provide possibility for transportation of 10m tons of cargos.
He then pointed to the advantages of free zones in Kazakhstan, reiterating that expansion of free zones in the south of the Caspian Sea will help the expansion of trade between Iran and the Eurasian Economic Union (EAEU) states. He then said that the delegation will transfer to the Kazakh investors the proposal of Iranians for investment in the Anzali Free Zone.
He also pointed to some other fields for cooperation and called on Iranians to cooperate.
Then Iran’s Agriculture Minister Sadatinejad, for his part, called for boosting the trade exchanges between Iran and Kazakhstan and said that the two countries can increase bilateral trade to $3b.
He said that in comparison to the political relation of the two countries, the economic relation is in lower level as the bilateral trade stood at $200m last year and it has increased to $400m this year and this means the trade relation does not accord with political ties. He went on to say that while in the past Iran-Kazakhstan trade volume was around $2.5b, this amount has slumped significantly.
He expressed hope this session would be a launching pad for boosting economic relations of the two states. He then referred to some points which can ease and broaden trade ties of the two countries. He said that setting up a joint committee on banking cooperation and agreement in using national currencies in bilateral trade is one of the important steps in easing trade between the two countries.
Sadatinejad then hailed signing of MoU between the customs administrations of the two countries which help the trade to be eased. He also said that resumption of the direct flights between the two countries is another step for expansion of trade and also called for regular restoration marine transportation of ro-ro between the two states.
He then pointed to some fields for cooperation between Iran and Kazakhstan like energy, tourism, industry, mine and judiciary.
Sadatinejad also called for easing visa process for Iranian economic traders or revoking it as an important step for boosting business between the two countries.
At the end of the session, the two countries signed five MoUs on cooperation in presence of Sultanov and Sadatinejad.
Meanwhile on Monday and to the two countries’ 17th Joint Economic Committee meeting, Iran Chamber of Commerce, Industries, Mines and Agriculture (ICCIMA) hosted an Iran-Kazakhstan business forum
The forum was attended by senior officials from the two countries, including Iranian Agriculture Minister Javad Sadati-Nejad, Kazakhstan’s Minister of Trade and Integration Bakhyt Sultanov, Kazakhstan’s Ambassador to Tehran Askhat Orazbay, ICCIMA Head Gholam-Hossein Shafei, and ICCIMA Deputy Head Mohammadreza Karbasi as well as Iranian ambassador to Astana Majiad Samadzadeh Saber.
Speaking in this gathering, ICCIMA Head Shafeie underlined Iran and Kazakhstan’s deep cultural and historical roots and noted that despite the great political relations between the two countries the level of trade is unsatisfactory.
He noted that having economic relations with the neighboring countries is a priority of the government and private sector in Iran and Kazakhstan as one of the biggest countries in central Asia has a significant place among Iran’s trade partners.
Shafei further mentioned the fact that despite all the restrictions during the COVID-19 pandemic, Iran and Kazakhstan’s borders were never closed on each other, and trade relations between the two countries were ongoing at all times.
Pointing to the great potentials and capacities of the two countries for mutual cooperation, Shafei said petrochemicals, oil, gas, mining, industry, agriculture, pharmaceuticals, as well as technical and engineering services all have the potential for mutual cooperation and investment between the two sides.
Elsewhere in his remarks, the official mentioned Kazakhstan’s membership to the Eurasian Economic Union (EAEU) and Shanghai Agreement, saying: “Kazakhstan’s position in such international treaties can be a good platform for Iran to expand its trade with the world.”
He further put the two countries’ trade level in 2020 at $235 million, saying that the Islamic Republic’s share of Kazakhstan’s total foreign trade in the mentioned year (which was $85 billion) is really insignificant.
Shafei also mentioned the capabilities of Iranian contractors in the field of technical and engineering services and said Iranian companies have previously worked on several projects in various areas including roads, highways, construction, etc. in Kazakhstan.
Elsewhere in the forum, Sadatinejad also expressed dissatisfaction with the current level of economic relations between the two countries and noted that the level of trade between Iran and Kazakhstan can reach $3 billion in the next three years.
Finally, Kazakhstan’s Minister of Trade and Integration Sultanov, for his part, underlined the positive relations between the two sides and said Iranian and Kazakh companies signed deals worth over $5 billion in 2021.
He stressed the need for complete use of the logistic capacities of the two countries for increasing the level of economic exchanges between the two sides.
He considered the role of the logistics sector in the expansion of trade between the two countries very important and noted that the Iran-Turkmenistan-Kazakhstan corridor has a significant role in reducing trade costs.
“We are already negotiating with Turkmenistan to reduce transit tariffs and facilitate trilateral trade; They have agreed to implement the reduced tariffs scheme for three months and I hope it will continue,” Sultanov stated.
