EU Statement at the Trade Policy Review of the Republic of Kazakhstan, 25 September 2024

I would like to welcome the Delegation of Kazakhstan, led by H.E. Mr Kairat Torebayev, Vice-Minister of Trade and Integration and the Ambassador H. E. Mr Asset Irgaliyev. I would like to thank the Discussant, Ambassador Sofia Boza Martinez (Chile) for introducing us to Kazakhstan's first ever Trade Policy Review since the accession to the WTO in 2015.

During the period under review, we have witnessed major challenges. Kazakhstan has shown economic resilience in the face of these challenges and proved to be an engaged WTO member. The EU and Kazakhstan share a strong commitment to the WTO and to further strengthening the rules-based multilateral trading system.

Since joining the WTO, Kazakhstan has seen significant economic growth and pursued notable economic reforms. The EU fully encourages and supports Kazakhstan's reform path to a more democratic model of governance and the promotion and protection of human rights. These are not only the foundations for a functioning democracy but are essential to attract foreign investment. The EU recalls the need to continue building a conducive environment for businesses to trade and invest.

The EU commends Kazakhstan's active role in the WTO since its accession. I would like to welcome back to Geneva H.E. Zhanar Aitzhan who has played an instrumental role in representing Kazakhstan in the WTO. In particular, the EU also welcomes Kazakhstan's participation in various Joint Statement Initiatives, including on E-commerce, Investment Facilitation for Development, and Domestic Services Regulation. The EU also appreciates Kazakhstan's ratification of the phase 1 Fisheries Subsidies Agreement. The EU looks forward to work together on WTO reform.

Trade relations between the EU and Kazakhstan are progressing well and the EU is the top trading partner of Kazakhstan. The EU is also the main provider in services and the main foreign investor in Kazakhstan. Our comprehensive Enhanced Partnership and Cooperation Agreement (EPCA) forms a solid foundation for taking our bilateral relations further. We stress the importance of its full implementation to further facilitate foreign investments and to improve the conditions for a more diversified and greener economy.

On the domestic front, the EU acknowledges Kazakhstan's efforts to diversify its economy, which is crucial for the country's long-term economic resilience and for reducing the volatility. We are also pleased to see Kazakhstan's growing commitment to environmental sustainability. The recently signed Memorandum of Understanding on Strategic Partnerships for Sustainable Raw Materials, Batteries, and Renewable Hydrogen between the EU and Kazakhstan is a testament to our shared vision for a greener future. We encourage Kazakhstan to continue its efforts to reduce reliance on fossil fuel exports and to embrace the opportunities presented by the green and digital transitions​.

We also encourage Kazakhstan to continue reducing the role of state-owned enterprises in the economy and fostering a more level playing field for private businesses. Promoting privatization and fair competition will increase efficiency across sectors and stimulate innovation.

We have submitted a number of questions to which we look forward to getting answers and clarification from Kazakhstan.

We note with concern the recent public procurement measures introduced by Kazakhstan, which exempt a wide range of imported goods from national treatment favouring domestic suppliers over foreign ones. The EU emphasizes the importance of ensuring that public procurement rules remain non-discriminatory, respecting the commitments made under the Enhanced Partnership and Cooperation Agreement (EPCA). We also encourage Kazakhstan to accelerate efforts towards joining the WTO Agreement on Government Procurement, a process, which has been significantly delayed.

Turning to the agricultural sector, the EU would like to highlight difficulties related to the challenging registration process of foreign establishments exporting animal-derived products to Kazakhstan and express concern about the country's support policies for agricultural machinery, which favour domestic products over imports. It is important that such subsidy programs do not lead to market distortions by creating barriers for foreign suppliers.

In general, the EU observes a growing number of measures introduced in Kazakhstan that promote local content requirements. While the EU fully supports the development of local industry and acknowledges Kazakhstan's desire to strengthen its domestic economy, it is essential that these measures are implemented in full compliance with Kazakhstan's obligations under the WTO and the EU-Kazakhstan EPCA.

The recognition of regional measures in response to animal disease outbreaks is critical for maintaining smooth trade relations. The EU encourages Kazakhstan to fully align with international standards on animal health and ensure the prompt recognition of disease control measures adopted by trading partners, which would safeguard the continuation of agricultural trade while managing disease risks effectively.

Finally, the EU notes the need for more structured consultation mechanisms with foreign business associations in Kazakhstan. While we appreciate existing efforts through online platforms, there is room to improve the inclusivity and effectiveness of consultations during the development of key regulations.

The EU remains committed to working closely with Kazakhstan to address these concerns and to continue fostering a strong, mutually beneficial trade relationship based on shared principles of openness, fairness, and sustainability.

On behalf of the EU, I wish the delegation of Kazakhstan a successful first Trade Policy Review.