AKIPRESS.COM - In 2018, the share of EAEU countries share in Kazakhstan’s foreign trade declined due to a boost in its trade with third countries driven by the growing prices of energy resources coupled with a record high oil production and the expansion of the capacity of the main pipeline that increase gas export potential, the Eurasian Development Bank reported.
These findings are presented in the report titled Main Trends in Kazakhstan’s Integration Development in 2018 prepared by the Centre for Integration Studies at the EDB’s Directorate for Research.
Kazakhstan’s mutual trade with the EAEU countries in 2018 fostered non-primary exports and economic diversification. This process was, however, constrained by remaining non-trade barriers. Investment cooperation with Russia was maintained at a relatively high level while the overall investment attractiveness of the EAEU weakened in 2018, and proactive institutional cooperation in promoting the Eurasian agenda was a significant support to the economy’s strategic industries.
In 2018, Kazakhstan’s cooperation with other EAEU countries declined in both significance and intensity. The main factor behind this was a boost in foreign trade with other countries and, in particular, export indicators. The significant dynamics of exports to other countries was maintained throughout the year, driven by high prices of energy resources, especially oil, gas and oil products, as well as grains, which ensured favourable conditions for trade for most of the period; record-high oil production and exports in physical terms; the expansion of the throughput capacity of the main gas pipeline; improved connectivity; and government measures to support non-primary exports, among other factors.
In terms of financial integration, investment cooperation with Russia, which was maintained at a rather high level as opposed to declining overall investment attractiveness of the EAEU region in 2018, constrained the negative effect of the decline in regional investment processes and ensured financial support for the economy’s strategic industries. In terms of net flows, Russia was Kazakhstan’s strategic counterpart among all FDI donor countries, having compensated net flows with other nations. Remittances are of limited importance to Kazakhstani economy and balance of payments compared to other EAEU countries that actively export the workforce (such as the Kyrgyz Republic or Armenia). Kazakhstan’s significant distinction in the EAEU region is that it is a donor country, like Russia.
In 2018, Kazakhstan continued to develop both multilateral and bilateral cooperation with other EAEU member states. The difficulties that arose in commodity trade were resolved rather quickly and compensated by new opportunities and solutions devised to ensure the efficient use of the Union’s potential and bilateral relationships between its member states.