Kazakhstan and USA strengthened their economic ties: Key moments
President Nursultan Nazarbayev's visit strengthened close commercial and trade ties between Kazakhstan and the United States, which will help to create new jobs and boost the economic growth in both countries. President N. Nazarbayev noted that these efforts are important for achieving Kazakhstan's goal of entering the world's 30 most developed global economies by 2050. During the visit, a number of commercial contracts and documents were concluded, including new agreements between the companies "Boeing", "GETransportation", "GEDigital", "Chevron", "Air Astana", "KTZ", "SKAT" and "Samruk-Kazyna" for the acquisition of US products and services worth more than 2.5 billion dollars.
The key moments of this economic cooperation include:
Regional Trade and Economic Development
Intergovernmental cooperation. Kazakhstan and the United States of America continue to cooperate on the implementation of WTO commitments, resolve existing disputes, improve Kazakhstan investment climate and increase bilateral investment. Two countries have recently concluded an air navigation agreement that will strengthen bilateral relations by simplifying the visits of senior US and Kazakh officials.
Promotion of regional trade. Kazakhstan and the United States cooperate in the sphere of the Trade and Investment Framework Agreement (TIFA) in Central Asia, which facilitates the expansion of trade in the region.
Kazakhstan demonstrated its leadership in trade issues by organizing a meeting in the Central Asian format of the TIFA on December 12, 2017 in Almaty. During this meeting, Kazakhstan and the United States agreed to establish a new regional Working Group on the Protection of Intellectual Property Rights in order to promote trade and innovation.
In October 2017, Kazakhstan, together with the US Agency for International Development, held the 7th Central Asian Trade Forum in Almaty with the participation of more than 1,100 official representatives, entrepreneurs, sponsors, industry leaders from at least 15 countries. This contributed to the signing of memoranda of intent to conduct in the future trade transactions worth more than 25 million dollars.
Bilateral trade. In 2016 the volume of bilateral trade turnover reached 1.9 billion dollars. Both countries are committed to further expanding trade relations. The United States welcomes Kazakhstan's interest in working on a bilateral agreement on civil aviation. This agreement will strengthen economic ties and will promote the growth of business contacts, encouraging affordable, convenient and efficient services for air passengers.
Trade in commercial aircraft. During the visit, two leaders welcomed individual deals between "Boeing" and Kazakh airlines totaling 1.3 billion dollars, supporting the opening of 7.1 thousand direct and indirect workplaces in the United States. In particular, "SCAT Airlines" ordered six "Boeing-737 MAX 8" aircrafts. Taking into account the planned delivery of the first aircraft in March 2018, these aircraft will be the first models of the "737 MAX" owned and operated in Kazakhstan and Central Asia, expanding the regional and international network of "SCAT". In addition, the national airline of Kazakhstan "Air Astana" has confirmed its commitment, in accordance with the terms of the existing contract, to purchase three "787 Dreamliner" aircrafts with the scheduled delivery in 2021.
Railways. "General Electric" Company (GE) and "Kazakhstan Temir Zholy" Company (KTZ) have concluded two new strategic initiatives estimated at almost 900 million dollars that will support or create 3,500 workplaces in the USA. "General Electric Transportation" will develop and produce up to 300 coupling locomotives for "KTZ", which will be delivered in 2019. "General Electric Transportation" also signed an 18-year agreement to provide services for the maintenance and support of 175 passenger locomotives "General Electric Evo" owning by "KTZ", starting in 2018. The deal will include the expansion of the main railway production of "KTZ" in Astana.
Agriculture. The USA and Kazakhstan recognize the importance of developing trade relations in the agricultural sector and will continue to explore opportunities to expand cooperation, including through the joint agricultural research. The joint research work helps both countries work towards achieving the safe and wide food security.
The development of Afghanistan. The United States and Kazakhstan support the achievement of the stable stability and prosperity in Afghanistan by providing the political support, increasing the regional trade and economic development. Kazakhstan announced the completion of a special training program for Afghan civilians and offered to continue to train specialists of this country at Kazakhstani institutions.
Digital infrastructure. "GE Digital" and "Samruk-Kazyna" SWF signed an agreement on strategic partnership aimed at accelerating the digital evolution of the portfolio of industrial companies of the Fund. The agreement demonstrates the progress of companies in creating a sustainable digital ecosystem in Kazakhstan and provides for joint evaluation of digital permissions of "GE" based on the "Predix" platform.
Leadership in the exploration of the outer space. The United States notes with appreciation that Kazakhstan is a point of departure and safe return of American cosmonauts working for the International Space Station. America offers Kazakhstan to participate in the 2nd International Space Exploration Forum on March 3, 2018 in Japan. Kazakhstan and the United States will explore the possibility of cooperating in the application of space technologies to assess threats to the environment and nature within the framework of the International Charter, which aims to provide a unified system for the acquisition and transmission of space data to countries affected by natural or man-made disasters.
Healthcare. The United States and Kazakhstan develop health services in Kazakhstan through cooperation with the Centers for Disease Control and Prevention (CDC). The University of Pittsburgh Medical Center (UPMC) is also working with Nazarbayev University to create a world-class cancer center that will serve the citizens of Kazakhstan and the whole of Central Asia.
Pharmaceuticals. "Pfizer" Company has signed a Memorandum of understanding with Kazakhstan on the possible implementation of a project to localize the production of secondary packaging of high-tech medical products. If the decision is positive, the project may include measures to improve the cold chain system for the transport and storage of medicines in Kazakhstan.
Kazakhstan and future energy
International exhibition "EXPO-2017". Kazakhstan held an exhibition "EXPO-2017" in Astana, demonstrating the leadership in innovation in the energy sector under the slogan "Future Energy". EXPO site will be provided for the "Astana" International Financial Center and the Park for Innovative Technologies.
Strategic energy dialogue. In 2017, the United States and Kazakhstan increased their bilateral energy partnership to the level of the Strategic Energy Dialogue. Practical discussions in the framework of the dialogue will begin in 2018. This expanded format provides the basis for cooperation in the development of peaceful nuclear industry, technologies for carbon capture, storage and utilization, stability of energy networks, as well as nuclear safety and non-proliferation.
Export of oil and gas and investments. "Chevron" and "ExxonMobil" Companies entered Kazakhstan market in 1993, becoming the first large oil companies to invest in the new independent country.
"Chevron" signed a landmark contract for a period of 40 years to develop a large "Tengiz" field, and over the years the company has invested tens of billions of US dollars in the oil and gas production in Kazakhstan, creating thousands of jobs, introducing world-class technology and best practices in the energy sector of the country.
"Chevron" signed a Memorandum of Understanding with the Ministry of Energy of Kazakhstan on the use of reinvestment funds worth 251 million dollars to finance lucrative projects in Kazakhstan.
With a total investment volume of over 20.2 billion dollars, "ExxonMobil" is actively engaged in the exploration, development, production and transportation of oil and gas.
"Tengizchevroil" JSC (TCO) is a joint venture with the participation of "KazMunayGas", "Chevron", "ExxonMobil" and "LukArco" - made direct financial payments of more than 124 billion dollars to Kazakhstani entities and it is currently implementing a project on expansion of production in the amount of 36.8 billion dollars.
The project under the "North Caspian Sea Production Sharing Agreement" (NCSPSA) is the largest foreign direct investment project in Kazakhstan, creating jobs and opportunities for business in the regions. The cost of the "Phase 1" project at the "Kashagan" field was about 55 billion dollars, and since 2004 the sales of goods, works and services amounted to more than 13.3 billion dollars. The project will work for decades, and its shareholders, including "ExxonMobil", expect that the Government of Kazakhstan as a direct income will receive billions of dollars.
"Chevron" and "ExxonMobil" contributed to the development of Kazakhstan's economy by participating in the "Caspian Pipeline Consortium" (CPC). In 2017, the CPC completed Kazakhstan’s part of the project to expand the pipeline, which could increase its total throughput capacity to 1.4 million barrels per day. The pipeline system is the most attractive option for the export of Kazakhstan oil from the "Tengiz" and "Kashagan" fields.
Nuclear power. Kazakhstan and the United States are committed to cooperation in promoting safe nuclear energy.
Kazakhstan is a leading supplier of uranium, having produced more than 24 thousand tons of nuclear fuel in 2016.
In 2017, Kazakhstan opened the Low Enriched Uranium Bank (LEU) in partnership with the United States of America. The LEU Bank provides a reliable source of fuel for countries transitioning to clean nuclear energy and reduces the risk of proliferation of enrichment technologies.
Modernization of the regional energy system. Kazakhstan and the United States agreed to explore technologies and projects for the reintegration of the regional energy system in Central Asia and improve the energy security, economic stability and promote commercial investment.
"Future Energy" is a regional measure in the framework of the 2015 Joint Declaration on Partnership between the five Central Asian countries and the United States of America (C5 + 1), which helps to support region's transition to climate-resilient economies with low emissions.
The "Future Energy" Program supports renewable energy projects that increase the energy efficiency in Kazakhstan, while improving the ability to identify and achieve more ambitious targets for reducing greenhouse gas emissions.
Strengthening of human capital
The visa program. In 2015, Kazakhstan initiated a short-term visa-free travel program for US citizens, and the United States began issuing 10-year business and tourist visas to citizens of Kazakhstan. These visa regimes contributed to the growth of trips to both countries, opening up new opportunities for business, investment and tourism.
Travels. Today, nearly 26,000 Kazakhstani citizens reside in the United States, and more than 5,000 US citizens reside in Kazakhstan. Last year, the Government of the United States issued about 18,000 visas to citizens of Kazakhstan, which facilitated numerous visits to the United States.
Education. The United States expressed its readiness to assist the Government of Kazakhstan in establishing a trilingual society until 2050. The United States will provide a development program to improve access to English language training and the preparation of a new generation of English language teachers in Kazakhstan. In 2017, more than 2,800 Kazakhstani teachers of English took part in Internet seminars on professional development.
In 2018, American teachers will help to improve the methodology of teaching English in the regions of Kazakhstan.
The "Microscholarship for Access to English" program helped 480 young students from disadvantaged families to attend lessons after school and to attend summer camps.
The United States is funding the "English for journalists" program that will improve the professional qualifications of 230 Kazakhstani journalists.
The "Bolashak" program. In 1993, Kazakhstan launched the "Bolashak" presidential scholarship program for study abroad. "Bolashak", which means "future" in Kazakh language, is an indication of the importance that Kazakhstan attaches to educating its youth at the best universities of the world.
The "Bolashak" program is a universally recognized scholarship that is paid to students from Kazakhstan for training at foreign universities.
The United States cooperates with the "Bolashak" program to assist in the selection process of scholarship holders and to expand the number of US universities participating in this program.
Since the establishment of this program in 1993, more than 12.5 thousand Kazakhstani students have received the "Bolashak" scholarship, 2,315 of which completed their studies in the United States. After graduation, the scholarship holders return to work in Kazakhstan for a period of at least five years. Currently, 358 "Bolashak" scholarship holders study at the US universities.
