Vietnam-Kazakhstan: Much Room for Cooperation

Kazakhstan, a country in the centre of the Eurasian continent, has the 9th largest area in the world, bordering Russia and China. At the seminar "Kazakhstan in the current period" held by the Vietnam Academy of Social Sciences, Mr Beketzhan Zhumakanov, Ambassador of Kazakhstan to Vietnam, said: "Over the past two decades, Kazakhstan has successfully built the model of political stability and national reconciliation on the basis of strong economic development. Quality of life is improved; people's incomes increased by dozens of times."

 

With the abundance of natural resources, Kazakhstan is the world's leader in reserves of zinc, tungsten and barite; it ranks second in the volume of silver, lead, uranium and chromium; third in copper and fluorspar; sixth in gold; 9th in the world oil reserves which have been discovered; and 8th in coal reserves.

 

Kazakhstan currently has trade relations with 194 countries and territories. In 2012, its total foreign trade volume reached over US$136.8 billion (in which exports account for over US$92.3 billion, imports US$44.5 billion). The country's top partners are China (US$23.98 billion, accounting for 17.5 percent of the total turnover), and Russia (US$23.86 billion, accounting for 17.4 percent of the total turnover). Regarding country block, the EU ranks first (US$53.8 billion, accounting for 39.3 percent of the total turnover), the SNG (Commonwealth of Independent States) occupy the second place (US$34.7, accounting for 25.4 percent).

 

Kazakhstan joined the Customs Union, which came in operation on 6th July 2010, the single economic space among the three countries (from 1st January 2012) which allows free exchange of goods, services, investment and labour in accordance with the macroeconomic policies of Russia, Belarus and Kazakhstan.

 

Prof Nguyen Quang Thuan, Vice Chairman of Vietnam Academy of Social Sciences (VASS), said that Vietnam and Kazakhstan signed several agreements on economics, trade, investment protection promotion and a number of memorandum of understanding and cooperation agreement. Bilateral trade cooperation is equivalent to about US$100 million a year.

 

Bilateral economic cooperation is currently carried out through the form of trade and investment whose value is not high. The results are totally incommensurate with the potential, political relations and efforts of the leaders of the two parties in strengthening relations of bilateral economic cooperation. To create a legal basis for cooperation, the two sides signed a joint action plan between Vietnam and Kazakhstan in 2011-2013 period, specifying objectives of reinforcing political, economic and trade cooperation between the two sides. According to the results of the 2011-2013 period, bilateral trade tends to increase with an average speed of 85 percent a year.

Regarding tourism, there is direct flight between the two cities of Almaty and Ho Chi Minh City, which facilitates the development of tourism.

 

The main export items of Vietnam to Kazakhstan include tea, pharmaceuticals, machinery for the food industry, computers and computer accessories, footwear and seafood. In contrast, Vietnam imports from Kazakhstan asbestos, steel and various types of transportation equipment.

 

In terms of bilateral investment, as of early 2013, the actual investment volume of Vietnam in Kazakhstan was US$1.6 million, while investment from Kazakhstan was only 0.2 million. This requires leaders as well as entrepreneurs of the two countries to pay more attention to both sides' markets and put more efforts to enhance bilateral economic cooperation to a new level of quality.

 

It can be seen that in the field of economics, both countries have great potential to boost bilateral cooperation. The economies of the two countries naturally complement each other. In commerce, Vietnam can meet the needs of Kazakhstan on tropical agricultural products, seafood, garments, footwear, pharmaceuticals and medical, electrical equipment, computers and computer components. The economy of Kazakhstan is in favour of exporting raw materials and can provide Vietnam with metal, leather materials, furs and fur products, chemicals, rubber, machinery and equipment for mining industry. The above mentioned items are items that Vietnam needs, and in which Kazakhstan has a comparative advantage.

 

Dr Doan Duy Khuong, Vice President of the Vietnam Chamber of Commerce and Industry, said: "Vietnam is in the top 30 countries with the highest exports in the world. However, exports and imports between the two countries remain modest, not commensurate with the actual potential of the two countries."

 

Ambassador Beketzhan Zhumakanov said: "We are also ready to work closely with Vietnam in international organisations. We all realize the need to build a multi-polar international system, with close views of the majority of the key issues of the current international situation."