President of Kazakhstan Nursultan Nazarbaev: Dear media representatives!
Today, as you saw, Vladimir Vladimirovich Putin and I took part in a forum for the leaders of the border regions of Kazakhstan and Russia. Within the forum we discussed a wide range of issues related to border cooperation in detail. Our agenda was very full.
As per usual in our bilateral meetings, it was in a very trusting atmosphere that we discussed the prospects for further economic, cultural and political cooperation between our countries. We visited an interregional exhibition of the manufacturers of our regions. Within this exhibition an international centre for cross-border cooperation, the Taskala-Ozinki logistics centre, was established. This centre will give an additional impulse to our relations, relations that are already developing successfully. I am pleased that the forum of border leaders plays a big role in the volume of trade between our countries. All the agreements that we reached in previous years – in Omsk in 2003 and in Cheliabinsk in 2005 – are being successfully implemented today.
The fact that today we signed an intergovernmental agreement on the border regime for the inhabitants of our two countries’ border regions is proof of this. As you know, we agreed on this last year in Cheliabinsk. You just heard about all the agreements on processing Karachaganak’s gas. And the agreement on cooperation in creating a joint enterprise based on the Orenburg gas processing plant. I wish to emphasise this major element in cooperation between Russia and Kazakhstan once again. Kazakhstan and Russia both own fifty percent of the Orenburg plant and about 1,5 billion USD will be invested in enlarging the plant. Half of this money will be provided by Kazakhstan. This is obviously profitable to the Orenburg region, to western Kazakhstan, and to all aspects of our states’ relations. Cooperation in this project is indeed one of the most important factors in Russia and Kazakhstan’s relations.
Today we also took part in opening the exhibition ‘Pushkin in Uralsk’ and, as you know, we have announced the Year of Pushkin in Kazakhstan and the Year of Abai in Russia.
To come back to our economic cooperation, today we were told that mutual investments are growing, and not only in trade. According to Kazakhstan’s official data, investments in Russia amount to 2,5 billion but this does not reflect the actual situation because I know that Lukoil alone invested 2,5 billion. So the actual amount of Kazakhsta’s investmnent is probably around eight to ten billion.
Therefore the forums between our border regions are becoming a factor that brings our countries closer together and increases the level of trust between them. Today we ordered our governors and akims to continue this work. This year our volume of trade will have grown by 30 percent. Over the last few years it has grown at impressive rates. We are confident that we shall continue this work in order to implement our agreements, develop the economies of our countries and ensure that the market niches of our producers will be associated with the most competitive products.
Vladimir Vladimirovich, please go ahead.
President of Russia Vladimir Putin: Dear ladies and gentlemen!
I shall begin by thanking all of our colleagues from Kazakhstan and the inhabitants of Uralsk for the warm welcome. I would especially like to thank Nursultan Abishevich for his initiative to carry out such forums and events. This forum was really necessary and highly effective.
We just took part in what is already our third forum. This consisted in a detailed and engaged conversation on the prospects for cross-border cooperation between our regions. This forum resulted in signing a whole number of agreements that you saw here. The President of Kazakhstan just recalled some of them and I would now like to do so as well.
I shall point out that interregional and cross-border cooperation is a significant element within the whole range of Russia and Kazakhstan’s relations. Especially considering the fact that, according to experts, this year the volume of mutual trade is approaching 12 billion, 11–12 billion USD.
Of course cooperation between border areas is not limited to trade. The links between border regions in the fields of culture, science, education and sports have always been close and fruitful. And today as we heard the speeches of akims and of governors, both drew our attention to the fact that of course it is not possible to know the whole range and volume of cooperation between our countries from Moscow or Astana. When the Governor of Orenburg said today that we have over a thousand students from Kazakhstan studying in Russia, this was a surprise even for the President of Kazakhstan. He said that a newspaper for Kazakhstan’s diaspora is being published there, and so on. All of these things are taking place beyond the control of any centre, including that of the capital. Such profundity and such a wide range of cooperation is of course, very much in demand. Certainly cooperation will continue to develop.
Over the last few years Russia and Kazakhstan’s partners cooperated even more actively to protect the environment and the use of natural resources, to struggle against smuggling and organised crime.
All of these issues were central to our discussion today. And participants of the forum made concrete proposals to develop cross-border cooperation. Now it is up to our countries’ governments or the administrations of border regions to take necessary decisions. I am confident that promising ideas and initiatives expressed at the meeting will be successfully implemented in practice.
Within the forum we signed a whole number of bilateral documents. The agreement on the border regime for residents of Russia and Kazakhstan’s border regions is especially significant. In this respect I completely agree with our colleagues’ evaluations of this document.
This agreement will substantially facilitate contacts between our citizens that live in both countries’ border regions. And this means that it will create new possibilities for the growth of our economic and cultural exchanges as well as for increasing a friendly, human dialogue.
Today the President of Kazakhstan and I also held separate talks on the whole range of our intergovernmental relations. We talked about relations between our countries as well as about our regional and international affairs.
We consider oil and energy, including nuclear energy, the agricultural industry, the transport industry, and space exploration to be among the priority sectors of our cooperation.
It is obvious that teamwork in these areas will result not only in tangible financial benefits but also will increase the competitiveness of Russia and Kazakhstan’s companies in foreign markets. After considering the research and production potential of Kazakhstan’s nuclear energy sector Nursultan Abishevich took the decision to include Kazakhstan in implementing the Russian initiative to establish an international centre supervised by the IAEA that would provide all the services in the nuclear fuel cycle, including enriching uranium, on Russian territory. We are referring to creating infrastructure that would allow various interested states to implement their right to non-discriminatory and guaranteed access to the benefits of nuclear energy. By doing so we would also strengthen the international regime of non-proliferation.
We paid close attention to the issue of integration, including possible ways to reform the CIS, and to develop cooperation within the Eurasian Economic Community and the Common Economic Space.
Russia and Kazakhstan are the leaders of various integration processes in the territory of the former Soviet Union.
I am confident that the results of our meeting in Uralsk will help Russia and Kazakhstan develop cross-border cooperation and the whole range of our cooperation. As a whole it will strengthen the tradition of friendship, trust and good-neighbourliness between our peoples.
Thank you for your attention.
Question (RIA Novosti): My question is for both Presidents. I am interested in the trade issue. You gave a new trade figure of $12 billion. Previously, the figure was put at $9 billion. But there is more talk now about improving the trade structure, changing it for the better. What steps are being taken in this direction? The second part of my question concerns the integration processes taking place between our countries and within the framework of existing groupings. What are the prospects in this area? Thank you.
Vladimir Putin: Yes, we are working on improving our trade structure. It has not changed significantly yet, but the overall volume of trade has increased considerably. In 2003, we had bilateral trade of around only $5 billion, but today, as we can see, we have now reached a figure of almost $12 billion this year. The structure itself has not changed significantly with energy prices rising, and this means that the share of manufactured industrial goods – machines, equipment, high technology – has increased considerably in absolute volumes, and this is very pleasing to see.
Nursultan Nazarbayev: I agree with what was just said. Trade is showing very good growth. When you look at the exhibition, it is impossible to list entirely the whole structure and who is selling what to who. But there is the question of the big positive trade balance in Russia’s favour, and this says something about the structure of our industry. I think that this imbalance will gradually even out. Our goods producers need to deliver more competitive goods to Russia. Today’s forum has made it clear that there are huge opportunities for doing this. I think that next year we will see considerable progress in this direction.
This year, the CIS will hold a meeting in Minsk, as we planned. Kazakhstan currently presides over the organisation and we are making very serious proposals to amend the charter and the structure of the CIS’ executive bodies in order to make it possible for the heads of state to examine the major issues. For example, the first agreement we are proposing concerns migration processes within the CIS, and this is an issue that concerns and interests everybody.
As for the Eurasian Economic Community, this is the most advanced integration-based grouping we have today and it already has six member states. Agreements have been reached already on around 65 percent of tariffs, and seeing as the documents on the Common Economic Space have brought us closer to creating a customs union, Russia, Kazakhstan and Belarus will sign part of the documents this year in order to move towards creating a customs union between our three countries by next May.
Ukraine will sign 14 of the 32 documents. That is, it will sign the documents as it becomes ready to do so. We very much want for the three countries that will sign the full package of documents to show the other countries just what benefits everyone stands to gain from integration of this kind.
Question (Habar Agency): My question is for both Presidents. The 1990s saw an active increase in investment flows from Russia to Kazakhstan. Now we are seeing the opposite trend, with increasing investment flowing from Kazakhstan into Russia. How do you explain this trend and what are your views on it?
Nursultan Nazarbayev: There’s more money now, more money available within Kazakhstan’s economy, and, having satisfied demand on the domestic market, this money starts to look for other markets. This is natural. Foreign countries do the same when they invest in Kazakhstan, and our country is also doing it now. The total assets of our banks come to around 70 percent of our gross domestic product, there are huge sums accumulated in the private pension fund and household savings are growing. I know that these figures are also very high in Russia, like here in our country. This gives national companies the possibility of acquiring funds.
As I said, we will build the Orenburg plant together, each side investing $750 million, making total investment of $1.5 billion. I also said that LUKOIL has just invested $2.4 billion in Kazakhstan, and according to my information, Kazakhstan companies have invested $8 billion in the Russian economy.
Vladimir Putin: Money always looks for where it can be put to best use. If someone has resources to spare and thinks that these resources could be put to best use in the relevant economic sectors in Russia, this can only make us happy, and we welcome any investment from Kazakhstan.