Tuesday, 25 Jun 2019
AMBASSADORS' COMMENTS

Large room remains for Kazakhstan-Vietnam trade and economic cooperation: Amb.

Updated at Thursday, 04 Apr 2019, 15:41
The Hanoitimes - Recently, Kazakhstan has been going through major political changes, on this occasion, Kazakhstan Ambassador to Vietnam Beketzhan Zhumakhanov shared with Hanoitimes his view on the matter and the cooperation prospects with Vietnam in the future.
Kazakhstan Ambassador to Vietnam Beketzhan Zhumakhanov. Photo courtesy: Kazakhstan Embassy to Vietnam.
Kazakhstan Ambassador to Vietnam Beketzhan Zhumakhanov. Photo courtesy: Kazakhstan embassy in Hanoi.
Kazakhstan's President Nursultan Nazarbayev has resigned after three decades in power, while the capital city's name has also been changed from Astana to Nur-Sultan. What is your view of these significant changes, and how do they impact Kazakhstan's diplomatic policies in the future, especially with Vietnam? 
On March 19, Nursultan Nazarbayev announced his resignation as President of Kazakhstan in a televised address to the nation. 

President Nazarbayev will continue to lead the Nur Otan party, and will remain Chairman of Kazakhstan’s Security Council and a member of the Constitutional Council. He will also hold the formal title ‘Leader of the Nation’, continuing to support the ongoing development of Kazakhstan.

First President Nazarbayev led Kazakhstan since its independence in 1991 following the collapse of the Soviet Union. He enabled unprecedented levels of development and prosperity, with Kazakhstan’s GDP increasing 15-fold and poverty falling 10-fold during this period. 

Kassym-Jomart Tokayev has been sworn in as President on March 20 until the next presidential elections which are due to take place in line with Kazakhstan’s constitution.

President Nazarbayev outlined the reasons for selecting Kassym-Jomart Tokayev as President, including having previously served as Foreign Minister, Deputy Prime Minister, Prime Minister, Chairman of the Senate, and Deputy Secretary-General of the UN.

With the departure of President Nursultan Nazarbayev, the foreign policy of Kazakhstan will remain unchanged. Kazakhstan will continue to firmly committed to its international obligations.

Previously known as Astana, the Kazakh word for capital, the change was proposed by President Kassym-Jomart Tokayev, as one of his first measures following his appointment to the presidency on March 20. 

President Tokayev said the decision is to honor the political heritage of Nursultan Nazarbayev and his historical legacy.

First President Nazarbayev originally proposed that Kazakhstan’s capital should be moved from Almaty to Astana in 1997. His own efforts contributed significantly to developing the city into a financial and logistics hub at the heart of Eurasia. This is undoubtedly one of his greatest political legacies.

During his address announcing his resignation, First President Nazarbayev noted that, “for the first time in the history of the country, we built our capital. Astana is a tangible personification of all our achievements and victories.”

Nur-Sultan is now the second largest city in Kazakhstan, with over one million inhabitants. It is the highest ranking Central Asian city in the Global Financial Centers index, and has hosted the EXPO 2017 exhibition on ‘Future Energy’, a previous summit of the Organization for Security and Co-operation in Europe, and numerous rounds of the Astana peace talks aimed at resolving the Syrian crisis.

Nur-Sultan has long been known as a hub for government, business and culture. Its striking modern architecture includes the 105-meter-high Baiterek Tower and the Khan Shatyr - the world’s largest tented structure, designed by British architect Norman Foster.

It is fitting that President Tokayev chose to honor First President Nursultan Nazarbayev in this way.
 
Kazakhstan's capital Astana has now been renamed to Nur-Sultan. Source: Maksim Bugayev.
Kazakhstan's capital Astana has now been renamed to Nur-Sultan. Source: Maksim Bugayev.
What is your view and expectations regarding the relations between the two countries at present and in the future? What are the potential fields of cooperation between the two, and your recommendations to realize all these potentials?

Nowadays, bilateral relations between Nur-Sultan and Hanoi are characterized with the absence of any disagreements on major issues of international politics. The basis of political dialogue has been formed on the exchange of visits at the highest level. In 2011, President of Kazakhstan Nursultan Nazarbayev paid an official visit to Vietnam, and in 2012 President of the Socialist Republic of Vietnam Truong Tan Sang paid a return visit to Kazakhstan. 

Following these visits, the main mutually beneficial areas of cooperation were identified, fundamental agreements were signed (on economic cooperation, on investment protection, on avoidance of double taxation, on transport cooperation, etc.), thus the basis for further interaction extensions was formed.

In this context, I would like to note that since its opening in 2014, the Embassy of Kazakhstan in Vietnam has been carrying out systematic and purposeful work to cover the entire spectrum of bilateral cooperation between Kazakhstan and Vietnam.

The embassy has been actively involved in participation and assistance of high-level visits between the two countries that began with the official visit of Chairman of the lower house of the Parliament of the Republic of Kazakhstan K. Dzhakupov in March 2015 and the official visit of Chairwoman of the National Assembly of the Socialist Republic of Vietnam Nguyen Thi Kim Ngan to Kazakhstan in October 2017. 

Thus, the visit of Chairman of the lower house of the Parliament of Kazakhstan K. Dzhakupov to Vietnam and the return visit of Chairwoman of the National Assembly of the Socialist Republic of Vietnam Nguyen Thi Kim Ngan to Kazakhstan initiated the friendly foundations of inter-parliamentary relations and formed friendship groups in the parliaments of both states.

It must be emphasized that today the foreign policy activity of parliamentarians has become one of the important factors of international politics. Deputies, as representatives of the people and special status holders, play an increasing role in the protection and promotion of national interests on the world stage. The Kazakh and Vietnamese parliamentarians make a significant contribution to strengthening bilateral relations in the framework of their international activities.

There is an intention to organize the visit of Chairperson of the National Assembly Nguyen Thi Kim Ngan to Kazakhstan in September 2019 with the aim of participation at the 4th Meeting of Speakers of Eurasian Parliaments on the theme “Greater Eurasia: Dialogue. Trust. Partnership”.

The Embassy of the Republic of Kazakhstan in Vietnam is actively working to develop trade and economic cooperation with Vietnam.

According to the State Revenue Committee of Kazakhstan at the end of 2018, the trade turnover between Kazakhstan and Vietnam amounted to US$467.2 million, including exports – US$179.04 million, and imports – US$288.1 million. In 2017, this figure for the first time amounted to US$542.7 million. 

These results were achieved thanks to the agreement on a free trade zone between the countries of the Eurasian Economic Union (EAEU) and Vietnam.

However, it’s noteworthy that the main share of exports from Kazakhstan today are commodities, such as lead and zinc, flat rolled iron or non-alloyed steel. Vietnamese imports are represented by telephones, household and office equipment, garment manufacturing products, footwear, and foodstuffs.

At the same time, according to a comparative analysis of statistical data on commodity turnover between Kazakhstan and Vietnam, as well as Kazakhstan with other neighboring countries in the ASEAN region for the period 2013-2018, Vietnam is one of the leaders among the countries of South-East Asia in terms of trade turnover with Kazakhstan. This indicates the presence of substantial potential in expanding trade and economic cooperation between Kazakhstan and Vietnam, and especially in the field of agriculture.

In our opinion, Vietnam with a population of over 94 million people is a promising market for the promotion of Kazakhstani agricultural products, in turn Vietnamese producers could supply seafood and fresh tropical fruits to the Kazakhstani market. I want to emphasize that the economies of our countries do not compete with each other.

I would like to note that the signing of the agreement on a free trade zone between the Eurasian Economic Union (EEU) countries and Vietnam, as well as our membership in the World Trade Organization does not give an automatic right to producers of Kazakhstan and Vietnam to sell their products at our markets.

To this end, it is necessary to create conditions for the opening of the markets of Vietnam and Kazakhstan for the export of agricultural products. First of all, it is necessary to sign the relevant documents, as well as solve issues on the removal of non-tariff barriers - sanitary and phytosanitary requirements for products of animal and vegetable origin.

Kazakhstan has all the opportunities to become a reliable supplier of high-quality and environmentally friendly products.

Nowadays, Kazakhstan is interested in the ASEAN market that is home to more than 600 million people.

The geography of our exports used to spread mainly to the traditional markets of nearby countries and Europe, because the delivery of goods was not particularly difficult. Today, after the launch of the New Economic Program "Nurly Zhol" put forward by the First President of Kazakhstan - Leader of the Nation N.Nazarbayev and the start of operation of the Kazakhstan terminal in the Chinese port of Lianyungang, we have great opportunities to launch products to new markets.

Certainly, taking into account the remoteness of our countries from each other, our businesses will face considerable difficulties without establishing optimal transport routes. Therefore, it is necessary to smooth logistics of Kazakh and Vietnamese goods so that they can be competitive.

To address this issue, the embassy, together with the National Company Kazakhstan Railways and Vietnam Railways, has been conducting targeted work on the development of a transport and logistics rail link between Kazakhstan and Vietnam in transit through China since 2016.

In 2018, a transport and logistics project was implemented for the first time, launching the first railway transit transport way along the Vietnam-China-Kazakhstan-Europe route. By opening this transit transport corridor, Vietnam has acquired another way of supplying its goods.

Taking this opportunity, I would like to thank the leadership of the Vietnam Railways for their active cooperation.
 
Illustration of the Vietnam-China-Kazakhstan-Europe railway corridor. Source: Hellmann Worldwide Logistics
Illustration of the Vietnam-China-Kazakhstan-Europe railway corridor. Source: Hellmann Worldwide Logistics.
The railway corridor connecting Vietnam to Europe through Kazakhstan has started operation, what are the impacts of the project towards Vietnam-Kazakhstan's economic and investments relations?

Summing up the year 2018, for the first time joint container trains were formed from the capital of Vietnam, Hanoi (Yen Vien station) through Vietnam's Dong Dang border railway terminal into the territory of the People's Republic of China to reach Europe, then transit through Kazakhstan, shipping 9.1 thousand tons or 1686 TFE (twenty-foot equivalent) to Duisburg (Germany).

Thus, the delivery time of goods produced by LG and Samsung companies from Hanoi to German Duisburg was 22 days, 2 days of which were required for the transportation of goods from Vietnam to China. Further, it took 20 days to transport this cargo to Duisburg. Subsequently, it is planned to reduce the delivery time of goods from Vietnam to Europe to 19 days. According to Vietnam Railways, volumes will increase significantly this year.

With the right approach in operation (tariffs, customs procedures, volumes of cargo transportation) of all countries for the transit of goods, this railway route will be most effective for delivering goods to European countries and back.

In general, Kazakhstan and Vietnam are connected by two transport routes: The Kazakhstan logistics terminal in the port of Lianyungang (China), through which Kazakh wheat is transported to Vietnam, and the route through the Vietnamese railway terminal Dong Dang.

Taking into account the fact that Vietnam has signed the Free Trade Agreement with the EAEU countries, where Kazakhstan is a constant member, the Kazakhstan-China-Vietnam reverse transit route will allow Kazakhstan and other EAEU countries to supply agricultural products to Vietnam, including meat and dairy products, and other types of goods requiring quick transportation.

In turn, Vietnam may send seafood and tropical fruits through this way to Kazakhstan, since the delivery time for such goods will not exceed 16 days.

Currently, Vietnam is finalizing a similar agreement with the European Union, which will diversify the transit transport corridor along the Vietnam-China-Kazakhstan-Europe route, reduce the delivery of goods from Vietnam and ASEAN countries to Europe, and in general will be a good alternative to the sea transportation.

I want to note that Kazakhstan acts not only in its own interests, but also in the interests of the countries of the EEU, the close friendly countries of Central Asia and the region.

The launch of this railway corridor opens up great prospects for the business of both countries. I believe that now it is the time to jointly think about the implementation of a large interstate project with the participation of Kazakh and Vietnamese business. It could be some investment project in one of the priority sectors of the economies of Kazakhstan and Vietnam.

At the same time, the promotion of such a project must necessarily be accompanied by support or guarantees from the governments of our countries. Kazakhstan today is open for business cooperation and we would like to hear any offers from Vietnamese business in various areas of cooperation.

In this context, I want to note that one of the financial instruments in mutual trade could be the participation of the Ho Chi Minh and Hanoi stock exchanges at the site of the Astana International Financial Center (AIFC), which is a special economic zone in whose territory a special arbitration court operates. The center operates in accordance with British law. 

We invite Vietnamese businessmen to join the work of this center and occupy their own niche in the region, since all favorable conditions for doing business have been created in Kazakhstan.

And finally, I would like to say that the work of our small team of the embassy is aimed at creating the most favorable conditions for the development of the entire spectrum of bilateral relations between Kazakhstan and Vietnam. 

For the last 6 years of the diplomatic presence of Kazakhstan in Vietnam, we managed to achieve great and clear results. An effective legal basis has been created, intergovernmental and corporate contacts have been established, and an active exchange of business delegations begins.

But at the same time, in the coming years, the embassy has set an ambitious challenge of bringing Kazakhstan-Vietnamese relations to a qualitatively new level.

Thank you very much!
Ngoc Thuy
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