Kazakhstan’s Economic Diversification: From Ukraine to Afghanistan

Kazakhstan’s Economic Diversification: From Ukraine to Afghanistan

The Ukraine war looks to have strengthened Kazakhstan’s positions in the global arena. The energy-rich Central Asian nation has managed to maintain its “multi-vector” foreign policy – balancing involving Russia and the West – and now it seeks to develop closer ties with other world-wide and regional actors.

The impending summit of the leaders of the Group of Turkic States, that need to just take position in early November in the Kazakh cash of Astana, will be an possibility for Kazakhstan’s coverage makers to increase political and economic relations not only with Turkey – an informal leader of the global overall body of expanding world wide visibility – but also with other Turkic nations around the world. Even though nearer ties with Turkey are one particular ingredient of Astana’s multi-vector tactic, the energy-loaded Central Asian state that has celebrated Republic Day on Oct 25 has obviously demonstrated its ambitions to turn out to be an important regional fuel hub.

Just after Russia started out supplying pure fuel to Uzbekistan (a member of the Group of Turkic States)  through Kazakh territory in early Oct, Kazakhstan has de facto turn out to be part of a tripartite fuel union in between Moscow, Astana, and Tashkent. At the similar time, the most significant state in Central Asia aims to raise economic cooperation with China – a major importer of Kazakh energy. It is, hence, not stunning that Kazakhstan’s President Kassym-Jomart Tokayev participated the third Belt and Road Forum for Global Cooperation in Beijing on October 17-eighteen. Just one of the objectives of the summit was to mark the tenth anniversary of Belt and Street Initiative (BRI) – a large infrastructure progress project, in which Kazakhstan plays an critical role.

But aside from its participation in the joint development of the Belt and Road, Astana also eyes to get the accessibility to the South Asian markets. Kazakhstan sees Afghanistan as an important transit country, which is why it seeks to enhance its positions in “The Graveyard of Empires”. Adhering to earthquakes that hit Afghanistan in early Oct, Astana delivered around 1600 tons of humanitarian support to Afghanistan’s Herat province. Kazakhstan’s active engagement in delivering humanitarian guidance to the people today of Afghanistan could be interpreted as the Central Asian nation’s try to acquire “soft power” in the Taliban-dominated country.

In spite of the actuality that the Taliban are officially thought of in Kazakhstan a terrorist corporation, in 2022 the trade turnover between the previous Soviet republic and Afghanistan attained just about $1 billion. Kazakh authorities reportedly look for to maximize the bilateral trade volume to $three billion in the pursuing a long time. The two sides a short while ago struck $200 million in new industrial promotions, largely commitments by Kazakhstan to supply Afghanistan with even more of the necessary meals. Presently, Kabul purchases about sixty % of all imported flour from Kazakh producers.

But Kazakh grain firms stay concentrated on other areas as properly. For instance, Kusto Agro – a organization with ties to Kazakhstan which is portion of the Singapore-primarily based holding firm Kusto Teamcontinues to function in Ukraine even with the ongoing war there. Above the previous two years, the company has been functioning to shield foodstuff security, when in late September, it even managed to ship the very first grain vehicles with the new harvest. Meanwhile, its chairman Yerkin Tatishev, supplied ability turbines to Ukraine to continue to keep the war-torn nation’s hospitals managing.

“The last two a long time ended up of program particularly hard for anyone in Ukraine. Our precedence has been to preserve persons safe, but against the backdrop of the war, we have ongoing to use our innovative procedures to improve food security and assure the crops we sow have the highest feasible yield”, said Tatishev.

Agribusiness is not the only point that connects Kazakhstan and Ukraine. Even while the Central Asian nation is Russia’s nominal ally in the Collective Stability Treaty Firm (CSTO), and is also a member of the Russian-dominated Eurasian Economic Union, Astana designs to drastically boost its financial cooperation with Ukraine. Russia, on the other hand, continues to be one particular of Kazakhstan’s key trade companions, but that does not prevent Kazakh leaders from establishing nearer financial ties with Moscow’s frenemy Turkey.

Ankara and Astana are stated to be developing transport ties to bypass Russia through the Trans-Caspian international transport route, which travels by way of China, Kazakhstan, the Caspian Sea, Azerbaijan, Ga, Turkey and onward to Europe. Meanwhile, overall trade quantity among Turkey and Kazakhstan now exceeds $5.3 billion every year and Erdogan has pledged to drive that to $10 billion. But that is nonetheless a lot less than 50 % of the $twenty five.five billion in trade that Kazakhstan does with Russia. That is one particular of the explanations why Astana, even with occasional odds with Moscow, does not approach to leave the Eurasian Economic Union.

For the foreseeable long run, Kazakhstan will certainly keep on pursuing its “multi-vector” foreign plan – based mostly on cooperation, equilibrium, and pragmatism – that has renewed the country’s relations with some of the most crucial geopolitical actors. On the other hand, in the extended-expression, Astana’s geopolitical vector will almost surely count on the consequence of the Ukraine conflict.

[Photo by Radosław Drożdżewski, via Wikimedia Commons]

Viewpoints expressed in this posting are people of the writer.

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