News ID: 214352
Published: 0222 GMT May 02, 2018

EEU, Iran eye to ink interim FTZ agreement

EEU, Iran eye to ink interim FTZ agreement

An interim agreement on establishing a free trade zone between Eurasian Economic Union (EEU) and Iran is planned to be signed on May 17 in Astana at the Astana Economic Forum, said Kazakh Minister of National Economy Timur Suleimenov at a government meeting on Wednesday.

According to TASS, Suleimanov said at the gathering, "In general, Iranian market has goods worth more than $8 billion, which are of export interest for Kazakhstan.

"Thus, getting more favorable terms, Kazakh producers have the opportunity to increase exports by more than threefold."

He noted that negotiations are also underway to sign free trade agreements with India, Egypt and Singapore.

"Besides, on May 17, it is planned to sign another document at the Astana Economic Forum — an agreement on trade and economic cooperation between the EEU and China," Suleimenov said.

This is an agreement on trade and economic cooperation between the EEU and China. The agreement is of a non-preferential nature and does not provide for cancelation of duties or automatic reduction of non-tariff barriers.

"At the same time, the agreement will improve the conditions for the access of domestic goods to the Chinese market through the norms in the agreement on simplifying trade procedures, increasing the level of transparency, as well as improving the level of interaction in all areas of trade cooperation," the minister pointed out.

He noted that the formation of free trade zones with third countries can significantly improve the conditions for the access of Kazakh goods to the markets of third countries. This work, he added, is currently carried out jointly with the countries of the EEU.

"A vivid example of stimulating exports through the conclusion of such agreements can be called the free trade agreement with Vietnam, which was signed in 2015. So, for two years of the agreement's implementation, the trade turnover between Kazakhstan and Vietnam increased 2.6 times. The volume of mutual trade for 2017 amounted to $542.7 million, showing an increase of 48.2 percent or $176.4 million compared to 2016. At the same time, non-primary exports to Vietnam in 2015 amounted to $9.5 million, and in 2017 increased to $272.3 million (or 27 times)," he added.

Kazakhstan is the 48th most complex economy according to the Economic Complexity Index (ECI). It has an export-oriented economy which is highly dependent on shipments of oil and related products (73 percent of total exports). Other exports include ferrous metals, copper, aluminum, zinc and uranium.

Main imports are electronics, machinery and mechanical appliances (25 percent of total imports), mineral products (15 percent), transport equipment (12 percent) and base metals and related products (10 percent).

On May 29, 2014, Kazakhstan and its Customs Union partners signed a treaty to create a common economic space known as the Eurasian Economic Union. The EEU is expected to further integrate their economies, and provide for the free movement of services, capital and labor within their common territory.

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