On December 25, a significant milestone was achieved in the economic relations between the Eurasian Economic Union (EAEU) member states and the Islamic Republic of Iran, as per the Astana Times. A Free Trade Agreement was signed on the sidelines of the Supreme Eurasian Economic Council (SEEC) in St. Petersburg. This agreement, represented by Serik Zhumangarin, Minister of Trade and Integration for Kazakhstan, is set to unlock the untapped potential of mutual trade.
Transforming Trade Relations
The focal point of this agreement is the establishment of a duty-free trade regime for over 90% of the external product range. This groundbreaking move will create favourable conditions for Kazakhstan’s agricultural and industrial products to enter the Iranian market. A key element is the guaranteed duty-free supplies of Kazakh grain to Iran within specified tariff quotas.
Broadening Scope
In addition to the preferential trade agreement, the broader trade accords cover various aspects, including regulatory protective measures, cooperation on technical barriers, sanitary and phytosanitary measures, customs collaboration, rules for determining the origin of goods, and dispute resolution mechanisms.
Enhancing Transparency and Cooperation
Transparency in public procurement and the development of industry cooperation, particularly in the transport and logistics sector, are also emphasized in the agreement. The focus on these sectors aims to facilitate smoother trade and economic activities, enhancing the overall partnership.
Iran: Promising Market
Iran’s population, which exceeds 85 mn, represents a substantial and promising market. Furthermore, its transit potential, coupled with the well-developed infrastructure of the Persian Gulf, positions it as an attractive partner for economic collaboration.
Boosting Development and Investment
The agreement is anticipated to boost the development of the North-South transport corridor, laying the foundation for diverse projects across various sectors and encouraging foreign direct investment. The signing parties foresee increased economic interaction, the realization of new projects, and a boost in foreign direct investment as direct outcomes of this historic agreement.
Trade Turnover: Positive Trend
As of the end of 2022, trade turnover between Kazakhstan and Iran reached $521.4 mn, marking an 18.3% increase compared to the previous year. Exports from Kazakhstan to Iran accounted for $309.7 mn, reflecting a 12.5% surge, while imports from Iran to Kazakhstan reached $211.7 mn.
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