SOUTH KOREA AND KAZAKHSTAN AGREE ON ENHANCED COOPERATION
On August 25, Kazakhstan’s President Nursultan Nazarbayev welcomed an official South Korean delegation to Astana, headed by the President of the Republic of Korea, Lee Myun-bak. This was their fifth meeting in three years, and a result of a number of bilateral contacts at the level of officials and businesspeople. When speaking to the press at the end of talks behind closed doors, the presidents announced the effective signing of 12 agreements that are intended to strengthen cooperation between the two countries in the light of an already existing strategic partnership concluded in May 2009.
The most important bilateral achievement secured during the visit of the South Korean delegation was the signing of an Intergovernmental agreement on the development, financing, designing, exploitation and maintenance of a new power plant on Lake Balkash in South-Eastern Kazakhstan. This project has been discussed for a number of consecutive years and will provide cheaper and safer electricity to local industries that continuously suffer from unstable energy supply and thus cannot increase productive capacities. Another important deal concerns the construction and financing of a modern petrochemical complex in Atyrau, on the Caspian Sea. This ambitious enterprise, worth about US$ 9 billion, is expected to improve Kazakhstan’s capabilities in terms of exporting sophisticated gas and chemical products to final users, without recurring to the services of intermediaries, who are still in possession of better technologies than the ones that Kazakhstan has been using. The second phase of this large-scale bilateral project will be implemented by a newly created joint-venture pooling both countries’ technological and managerial experience.
According to Nazarbayev, Astana and Seoul are now expecting to catch up with the pre-crisis levels of overall trade, which grew by 50 percent in 2010 and will probably reach the level of US$ 900 million this year. This trend is only accentuated by the extensive activities of around 300 South Korean companies operating on Kazakh soil. Kazakhstan is currently home to two car making plants in its northern and eastern regions, and South Korea has become one of the leaders in terms of foreign direct investment, having already contributed almost US$ 4 billion. In pursuit of the national strategy aimed at speedy economic diversification, Nazarbayev warmly invited the South Korean business community to participate in any of the priority industrialization projects boosted by the Kazakh Government and benefiting from privileged tax regulations.
As Myung-bak remarked in his speech, Kazakhstan was one of the few countries in the world to extend a warm and hospitable welcome to more than 150,000 ethnic Koreans subjected to mass deportations and peacefully settled across Kazakhstan’s vast expanse of land. “Kazakhstan is the only country in the post-Soviet space and possibly in the whole world to have on its soil a Korean national musical and drama theater. This is the symbol of our friendship, our brotherhood and a bridge between the two nations,” Nazarbayev stated, further saying that South Korean-Kazakh relations are famously friendly and stable. During the visit, the presidents made a decision to establish a joint technological center that will bring its valuable expertise to the needs of industries and science. Personal relationships have also proven to be of great importance in the development of a closer political dialogue between the two capitals. At the time when Myung-bak was Seoul’s mayor, he conferred honorary citizenship on the visiting president of a newly independent Central Asian republic and even created an alley dedicated to Kazakhstan in one of the South Korean capital’s most popular quarters. This time, Nazarbayev granted honorary citizenship of Astana City to his South Korean colleague.
Amidst the ever-worsening political situation in Kazakhstan’s southern neighbors, where South Korea had considerable economic interests throughout the 1990s and in the early 2000s, Kazakhstan is now becoming a preferred destination for South Korean capital. Whereas Uzbekistan once provided its soil and manpower for the assembly of Daewoo’s passenger cars, Kazakhstan was later chosen for the serial production of Hyundai’s mini-buses, currently very frequent and easily recognizable in Kazakh cities. As if in order to overtake its European and Asian competitors in a bid to carve out a large chunk of lucrative contracts in the oil and gas sector, the Republic of Korea has recently been very active in promoting its own know-how in direct contacts with Kazakhstan’s political representatives. It should also be remembered that the Korean ethnic community, whose unofficial leader Vladimir Ni was Nazarbayev’s closest advisor before his death in late 2010, exerts considerable economic influence in various sectors of the national economy. The president of KazakhMys, the country’s largest producer of mineral resources, is another ethnic Korean whose profile can be found on the Forbes’ international list of billionaires.
