Kazakhstan – Muhasebe News

The Revival of Ancient Silk Road!

MuhasebeNews — Thu, 20 Apr 2017 08:23:41 +0000

China is moving forward with an ambitious project to build a new Silk Road linking Asia, Africa, the Middle East and Europe.

Representatives of as many as 110 countries are expected to attend including Russian President, Pakistani Prime Minister and Cambodian Prime Minister, as well as the leaders of Myanmar, Kazakhstan, Malaysia and Indonesia.

It is regarded to be the country’s biggest diplomatic event of 2017.

Source: Euronews

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Growth in Kyrgyzstan projected to slow to 3.0% in 2017 and recover to 3.5% in 2018: ADB

MuhasebeNews — Tue, 18 Apr 2017 11:50:02 +0000

Growth in Kyrgyzstan will slow down in 2017, but will accelerate in 2018, Tazabek reported citing the Asian Development Bank’s (ADB) Asian Development Outlook 2017.

“Growth is projected to slow to 3.0% in 2017 because of a high base in 2016 and an expected decline in output from Kumtor, the main gold mine. It is expected to recover to 3.5% in 2018 with some improvement in the domestic economy and higher growth in the country’s main regional partners, Kazakhstan and the Russian Federation,” the Bank said.

“Strong performance in gold mining and trade overcame an early slump to bring 3.8% expansion in 2016. Currency appreciation and higher remittances curbed inflation and the current account deficit. Growth is projected to slow to 3.0% in 2017 before recovering to 3.5% in 2018 with faster regional growth. Higher inflation and a wider current account deficit are likely. Eurasian Economic Union membership poses both challenges and opportunities,” the Bank said.

Growth slowed marginally to 3.8% in 2016 from 3.9% in 2015 as strong performance in gold mining and trade offset a slowdown in manufacturing, as well as spillover from recession in the Russian Federation and slower growth in Kazakhstan.

Source: akipress.org

Kyrgyzstan starts exporting hats, ties, microphones to Eurasian Economic Union member states

MuhasebeNews — Mon, 27 Mar 2017 11:19:18 +0000

In 2016, Kyrgyzstan started exporting more than 100 new goods including hats, ties, and microphones to the Eurasian Economic Union member states – Kazakhstan, Russia, Belarus, and Armenia, reports Tazabek.

Mutual trade turnover of Kyrgyzstan with the EAEU totaled $42.5 billion or 93.3% to the 2015 trade turnover.

Mineral products have the biggest share in the commodity structure of mutual trade turnover – 27.1%, and 85% of them are supplied by Russia.

Machinery, equipment and vehicles have 17.5% in the trade turnover structure and 54.7% of these goods are supplied by Russia and 41.9% by Belarus.

The share of food and agricultural raw materials is 16.1%, chemicals – 12.4%.

Compared to 2015, Kyrgyzstan’s exports to the EAEU have increased by 4.4%. Kyrgyzstan saw its textile products’ export down in 2016 by 9.2%.

Source: akipress.org

TOP-4 importers of Kyrgyzstan and goods they sell

MuhasebeNews — Mon, 27 Mar 2017 11:09:16 +0000

Russia, Kazakhstan, Turkey and China were the top-4 importers of Kyrgyzstan during the first ten months of 2016, Tazabek reported citing the official data.

Russia imported oil and oil products for $230.9 million, iron and steel – $76.8 million, natural gas – $29.2 million.

Kazakhstan imported cereals and cereal products for $73.2 million; Turkey – clothing and accessories for $51.6 million, textile yarn, fabric, finished products – $21.3 million; and China imported garments and accessories – $166.6 million, iron and steel – $35.8 million.

The goods deliveries from the CIS countries in January-October 2016 to Kyrgyzstan decreased by $374.7 million amounting to $1.396 billion or 42.7% of total imports.

Meanwhile, the imports from the non-CIS countries increased by $348.2 million and amounted to $1,875.9 million (57.3%).

Source: akipress.org

Investment Legislation

MuhasebeNews — Mon, 13 Mar 2017 13:39:08 +0000

Turkey’s investment legislation is simple and complies with international standards, while it offers equal treatment for all investors. The backbone of the investment legislation is made up of the Encouragement of Investments and Employment Law No. 5084, Foreign Direct Investments Law No. 4875, the Regulation on the Implementation of the Foreign Direct Investment Law, multilateral and bilateral investment treaties and various laws and related sub-regulations on the promotion of sectorial investments.

Legal Framework of Foreign Direct Investment
1. Foreign Direct Investment (FDI) Law No. 4875

The aim of the Foreign Direct Investment (FDI) Law No. 4875 is:

to encourage FDI in the country
to protect the rights of investors
to align the definitions of an investor and investment with international standards
to establish a notification-based system rather than an approval-based one for FDI
to increase the volume of FDI through streamlined policies and procedures

The FDI Law provides a definition of foreign investors and foreign direct investments. In addition, it explains important principles of FDI, such as;

freedom to invest,
national treatment,
expropriation and nationalization,
freedom of transfer,
national and international arbitration and alternative dispute settlement methods,
valuation of non-cash capital,
employment of foreign personnel,
liaison offices.

The Regulation on the Implementation of the FDI Law consists of specifying the procedures and principles set forth in the FDI Law. The aim of the FDI Law with regard to the work permits for foreigners is:

to regulate the work carried out by foreigners
to stipulate the provisions and rules on work permits given to foreigners
2. Bilateral Agreements
2.a. Bilateral Agreements for the Promotion and Protection of Investments
Bilateral Agreements for the Promotion and Protection of Investments were signed from 1962 onwards with countries that show the potential to improve bilateral investment relations. The basic aim of bilateral investment agreements is to establish a favorable environment for economic cooperation between the contracting parties by defining standards of treatment for investors and their investments within the boundaries of the countries concerned. The aim of these agreements is to increase the flow of capital between the contracting parties, while ensuring a stable investment environment. In addition, by having provisions on international arbitration, they aim to prescribe ways to successfully settle disputes that might occur among investors and the host state. Turkey has signed Bilateral Investment Treaties with 94 countries. However, Turkey is a dualist country, where an international treaty has to be ratified and promulgated in order to become part of the national legal system. Within this regard, 75 Bilateral Investment Treaties out of these 94 have gone into effect so far.

75 countries
Afghanistan, Albania, Argentina, Australia, Austria, Azerbaijan, Bangladesh, Belarus, Belgium-Luxembourg, Bosnia and Herzegovina, Bulgaria, China, Croatia, Cuba, Czech Republic, Denmark, Egypt, Estonia, Ethiopia, Finland, France, Georgia, Germany, Greece, Hungary, India, Indonesia, Iran, Israel, Italy, Japan, Jordan, Kazakhstan, Kuwait, Kyrgyzstan, Latvia, Lebanon, Libya, Lithuania, Macedonia, Malaysia, Malta, Moldova, Mongolia, Morocco, Netherlands, Oman, Pakistan, Philippines, Poland, Portugal, Qatar, Romania, Russian Federation, Saudi Arabia, Senegal, Serbia, Singapore, Slovakia, Slovenia, South Korea, Spain, Sweden, Switzerland, Syria, Tajikistan, Thailand, Tunisia, Turkmenistan, Ukraine, United Arab Emirates, United Kingdom, United States of America, Uzbekistan, Yemen
Source: Ministry of Economy

2. b. Double Taxation Prevention Treaties
Turkey has signed Double Taxation Prevention Treaties with 80 countries. This enables tax paid in one of two countries to be offset against tax payable in the other, thus preventing double taxation.

80 countries
Albania, Algeria, Australia, Austria, Azerbaijan, Bahrain, Bangladesh, Belarus, Belgium, Bosnia and Herzegovina, Brazil, Bulgaria, Canada, China, Croatia, Czech Republic, Denmark, Egypt, Estonia, Ethiopia, Finland, France, Georgia, Germany, Greece, Hungary, India, Indonesia, Iran, Ireland, Israel, Italy, Japan, Jordan, Kazakhstan, Kuwait, Kyrgyzstan, Latvia, Lebanon, Lithuania, Luxembourg, Macedonia, Malaysia, Malta, Moldova, Mongolia, Morocco, Netherlands, New Zealand, Norway, Oman, Pakistan, Poland, Portugal, Qatar, Romania, Russian Federation, Saudi Arabia, Serbia and Montenegro, Singapore, Slovakia, Slovenia, South Africa, South Korea, Spain, Sudan, Sweden, Switzerland, Syria, Tajikistan, Thailand, Tunisia, Turkish Republic of Northern Cyprus, Turkmenistan, Ukraine, United Arab Emirates, United Kingdom, United States of America, Uzbekistan, Yemen
Source: Revenue Administration

Turkey is continuing to expand the area covered by the Double Taxation Prevention Treaty by adding more countries on an ongoing basis.

2. c. Social Security Agreements
Turkey has signed Social Security Agreements with 26 countries. These agreements make it easier for expatriates to move between countries. The number of these countries will increase in line with the increased sources of FDI.

26 countries
Albania, Austria, Azerbaijan, Belgium, Bosnia and Herzegovina, Bulgaria, Canada and the Province of Quebec, Croatia, Czech Republic, Denmark, France, Georgia, Germany, Libya, Luxembourg, Macedonia, Netherlands, Norway, Romania, Slovakia, Serbia, South Korea, Sweden, Switzerland, Turkish Republic of Northern Cyprus, United Kingdom
Source: Social Security Institution (SSI)

3. Customs Union and Free Trade Agreements (FTA)
A Customs Union Agreement between Turkey and the European Union has been in effect since 1996. The agreement allows trade between Turkey and the EU countries without any customs restrictions. The EU-Turkey Customs Union is one of the steps toward full Turkish membership of the EU itself.

Turkey has FTAs with 37 countries, creating a free trade area in which the countries agree to eliminate tariffs, quotas and preferences on most goods and services traded between them. This framework explains why many global companies are now using Turkey as a second supply source and manufacturing base, not only for the EU and rapidly growing Turkish markets, but also for the Middle East, Black Sea and North African markets, with the added advantage of a relatively low-cost but well-educated labor force, coupled with cost-effective transportation.

37 countries
Albania, Bosnia and Herzegovina, Egypt, Georgia, EFTA, Israel, South Korea, Macedonia, Morocco, Malaysia, Mauritius, Palestine, Jordan, Syria*, Tunisia, Montenegro, Serbia, Chile
Countries that have finalized the negotiation process: Faroe Islands, Ghana, Kosovo, Lebanon, Moldova, Singapore
Countries in the negotiation process: Democratic Republic of the Congo, Cameroon, Colombia, Ecuador, Gulf Cooperation Council, Japan, Libya, Mexico, Mercosur, Peru, Seychelles, Ukraine *suspended
Source: Ministry of Economy

Date: 13 March 2017