Trade of Kazakhstan within the EAEU: Features and Nuances

The Republic of Kazakhstan has been a member of the Eurasian Economic Union (EAEU) since the day the EAEU was established. Other member countries of the Union are considered priority areas for trade relations. Economic integration is facilitated by the EAEU agreement, which ensures the free movement of goods, labor, and services across the Union’s territory, and a unified policy in various sectors of the economy. To coordinate the movement of goods through customs, the EAEU Customs Union was established. A zero VAT rate is applied when member countries export goods within the Union.

Kazakhstan and EAEU Export and Import in 2024

Statistics for 2023 show that the export of goods from Kazakhstan to EAEU countries increased by 9.5%, reaching 11 billion USD. Imports decreased by 9.3% (with a total value of 17.5 billion USD). This trend continues into 2024.

Exports from Kazakhstan to the EAEU focus on three product groups:

• Chemical Industry Products: They account for 26.4% of the total export turnover.
• Equipment and Vehicles: A significant portion involves the trade of machinery. This category makes up 25.5% of the total trade volume.
• Metals and Metal Products: They account for 17.3%. The country exports light, heavy, ferrous, and non-ferrous metals such as aluminum, copper, steel, pig iron, and tin.

If a Kazakh company plans to engage in mutual trade of goods and services with EAEU countries, other areas should also be considered. Kazakhstan exports mineral resources and raw materials (ores, oil, stone), as well as food products (flour, cereals, oils, confectionery, natural juices, dairy products).

Regarding the import of goods from the EAEU to Kazakhstan, it is worth noting the supply of metals, which account for 19.4% of the total turnover. Entrepreneurs in Kazakhstan import food products, passenger cars, clothing, and medicines. Industrial equipment has become an important part of imports.

Why is Trade between Kazakhstan and the EAEU Beneficial for Business?

Thanks to the free trade agreement between EAEU countries, comfortable conditions have been created for Kazakh companies:

• Due to the unified principles of customs control (uniform duties, HS codes, etc.), the number of customs procedures is reduced. For example, there is no need to file customs declarations and obtain transportation permits.
• Another advantage is cost savings. When trading within the EAEU, there is no need to pay for customs broker services, pay for temporary storage warehouses, and so on.
• The number of documents is reduced. Documents have the same legal force, so they can be issued in one country. This applies, for example, to certificates of conformity, veterinary control certificates.
• The EAEU has a unified transport space. This means that transport from Kazakhstan can move goods freely. For example, there is no need to carry out transshipment or reload goods at the border.
• Duty-free trade operates within the EAEU. This means that entrepreneurs can sell goods in retail stores (Duty-Free) to people who are leaving or arriving in the Union territory without paying taxes and fees (including excise taxes). Duty-free import of goods to Kazakhstan implies certain restrictions (for example, no more than 3 liters of alcohol and no more than 200 cigarettes per adult passenger).

All these factors make the development of trade in the EAEU countries one of the promising directions for Kazakh business.

Trade between Kazakhstan and Russia

As of 2023, the external trade of Kazakhstan with EAEU countries is distributed as follows: 91.1% of the turnover is with Russia, 5.5% with Kyrgyzstan, 3.2% with Belarus, and 0.2% with Armenia. This confirms that even under sanction pressure, trade relations between Kazakhstan and Russia remain a priority in 2024.

The trade turnover between Russia and Kazakhstan includes both import and export transactions. Imports dominate: if export contracts are valued at 9.7 million USD, then imports exceed 16.1 million USD. What goods are of interest to entrepreneurs in both countries?

Exports of goods from Kazakhstan to Russia focus on ores and steel rolled products. Kazakh entrepreneurs supply their Russian counterparts with zinc, coal, natural gas, and precious metal concentrates.

Imports of goods from Russia to Kazakhstan are concentrated on agricultural products (wheat, sunflower seeds) and petroleum products. Kazakh businessmen are also interested in purchasing such goods in Russia as insect and weed control agents, gold, and plastics.

Entrepreneurs engaged in trading goods with Russia should consider that many Russian banks are under sanctions in Kazakhstan.

Mutual and External Trade within the EAEU

When establishing trade relations with entrepreneurs from other Union countries, Kazakh businessmen should remember about the currency of settlements and the preparation of the necessary documents.

The share of national currencies in trade between EAEU countries has reached 90%. When trading between EAEU countries and third countries, the currency of settlements remains the US dollar.

All Kazakh banks work with Russian rubles, so there are no difficulties with payments. The speed of settlements remains relevant. It is important to choose the right partner bank. Bank CenterCredit provides services within foreign economic activity. Among the advantages of a comprehensive solution are online contract registration, currency control, personal manager support, and affordable service rates. The SWIFT GPI Tracker system is responsible for the prompt processing of payments. Pay attention to other Bank CenterCredit products that enhance business efficiency. For example, a free counterparty verification service helps avoid cooperation with unscrupulous entrepreneurs and minimizes economic risks.

When carrying out external trade between Kazakhstan and other EAEU countries, remember the need to pay taxes correctly.

When importing goods into Kazakhstan from other Union states, Form 328.00 is filled out, and an electronic invoice is issued. VAT in this case is 12%.

Documents confirming exports from Kazakhstan to EAEU countries include waybills for stock release and cargo transportation. VAT on exports is applied at a zero rate, but the entrepreneur must document the legality of using such a rate.

Mutual trade with EAEU countries remains a priority for Kazakhstan's development. The trend of recent years towards increasing the share of exports indicates the interest of Union country businessmen in Kazakh products. This opens up new prospects for entrepreneurs in Kazakhstan.

This article has been translated from its original language using neural network-based translation technology