Kazakhstan looks to new markets with Customs Union

With Kazakhstan looking to capitalize on the creation of a customs union with Russia and Belarus, Business RT spoke with Kazakh Prime Minister Karim Masimov, about the advantages and about energy export plans.

­KM:  “Kazakhstan is known to the world because we have quite huge reserves of natural resources, preferably oil and gas and minerals etc. But to be only a supplier of resources to the world is not our goal. Our destination today is to have a competitive free market economy – to have a competitive population with a high standard of education.”

RT: It’s been almost a year since the creation of the customs union of Russia Kazakhstan and Belarus.  How would you assess its work? What problems have been revealed during this year, and where has it been most successful?

KM:   “Of course we had some difficulties in the past, maybe will be some difficulties in the future, but at the same time we do have very achievable results.  And I think that the achievable results are that our economies and enterprises within the customs union became more competitive, and enterprises within the custom union have more competitive advantages because the market is much bigger than it used to be before, especially for Kazakhstan –we have only 16 million population.  Now we can produce our goods for hundred and seventy million population – this is a good advantage for us.”

RT: The new tariff policy in the Customs Union will be based on current tariffs existing in the Russian Federation.  It will get 90% of all the duties, while Kazakhstan will receive only 7%. What is your opinion – is this workable?

KM: “It is not only workable, it is already working, and we already feel the advantages of that. I think, it gives the possibility to set up new enterprises on the territory of all the members of the custom union including Kazakhstan. We already feel more interest from foreign companies to invest in Kazakhstan because now they are looking for a much bigger market – not only 16 million population – and we already feel this interest from the outside investors.”

RT: Kazakhstan plans to double oil extraction by 2020.  What will be the priority in the country’s energy policy and what export markets will Kazakhstan target?  

KM: “Kazakhstan is planning to double the export possibilities by 2020 and the destination for our export of our energy resources are traditional countries through Russian pipeline system to Europe, through CPC (Caspian pipeline consortium project), through Russian territory Baku – Tbilisi – Ceyhan and to China. I think, we will export as much as possible and even though the existing capacity is not enough, and we are discussing with all the members, with all the neighboring countries the possibility for a future export. But the first choice is Russia.”