Kazakhstan and Iran Strengthen Trade Ties

Kazakhstan and Iran Strengthen Trade Ties

Kazakhstan has ratified the interim trade agreement between the Eurasian Economic Union and Iran. This will significantly expand and strengthen markets of Kazakhstan and Iran, experts say. The agreement ensures lowering of import duties on both sides. Tehran is offering tariff preferences for 864 items coming from Kazakhstan. In the next three years, with a lowered duty rate, Kazakhstan will import beef, mutton, legumes, vegetable oils, pasta and confectionery products as well as rails, batteries and fitments to the Iranian market. Today all these goods make up more than half of current Kazakhstan’s exports. In return, Kazakh and the EAEU member countries will lower import duties on Iran’s 502 items. Iran will be able to export pistachios, dates, figs, raisins, shrimps as well as dishes, household chemicals and carpets.  

‘This agreement is beneficial to both Iran and Kazakhstan. The economical advantage is obvious which is development of the market, strengthening of relations and also strengthening of positions for us. When there is unreasonable pressure on Iran from some countries which negatively affect the country's economy, it is very gratifying to see truly competent politicians who understand that Iran can be a good financial partner,’ Economist Mohammad Vatanpur told Kazakh TV.

Discussion on the contract first started at the Astana Economic Forum in 2018. The temporary agreement on a free trade zone between the EEU and Iran was signed in the capital of Kazakhstan. Back then, experts were only talking about prospects of such cooperation. Politicians said that the agreement was not only an economically important step, but also a strategic one.  

Political observer Mariam Shokrani believes the strengthened trade ties between Iran and EAEU will help popularize the Kazakh and Iranian goods. ‘People will find out how rich Iran is and we will learn more about the potential of Kazakhstan. Secondly, this will bring our states closer and will raise the level of trade relations with Kazakhstan and other EAEU member countries,’ Shokrani said.

The volume of mutual trade between Kazakhstan and Iran amounted to more than US$516 million in 2018. Experts believe that this figure may increase several times with the permanent agreement on a free trade zone entering into force. Within a year after ratification, the parties will begin negotiations on the permanent agreement on the free trade zone.

Photo: kapital.kz