Commercial Learnings of Kazakhstan for Make Benefit Glorious Exports of America

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Commercial Learnings of Kazakhstan for Make
Benefit Glorious Exports of America

• Stuart Schaag
• Senior Commercial Officer
• U.S. Embassy Branch Office, Almaty

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What Kazakhstan Is Not!
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Agenda

• A Hypothetical Situation
• Why Kazakhstan Should Be On Your Radar
• Obstacles and Limitations
• Two Case Studies Getting it Right!

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Obligatory Statistics

• U.S exports doubled from 2004-2006.
• Annual growth rate of appr. 9 this decade.
• Per capita GDP second only to Russias.
• U.S. investment reaching 14 billion.
• Investment grade rating.
• Large reserves of natural resources oil, gas,
  coal, minerals.

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Why Kazakhstan? Why Now?

• Source of energy for a Russia-dependent Europe
  and an energy-starved China.
  
• Demand for new infrastructure and the financing
  to pursue it.
  
• Strong banking sector to support growth.
• Firmly positioned economic leader of Central
  Asia.
  
• Growing middle class.

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Actively Pursuing Diversification

• Goals
• Modern, diversified economy
• High value added and high-tech component
• Strengthening of the non-oil sector
• Economy largely privatized
• National Fund and National Innovation Fund
  seeking to attract new industries.

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Kazakhstan Could Be Right For You If

• Export sales are an important part of your
  business and emerging markets are a critical
  element.
  
• Your firm has experience in Eastern Europe,
  Russia, or Ukraine.
  
• Your firm is active in GOK growth sectors
  construction materials, food processing,
  metallurgy industries, transportation
  logistical support, oil and gas equipment
  production, agriculture machinery
• You are willing to invest your time and effort
  for the long haul.

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Obstacles and Limitations

• Small market size 15 million population.
• Regional market lacks financial resources.
• Weak infrastructure transportation links and
  telecommunications.
  
• Regulatory costs taxation, work permits.
• Transparency of customs judicial system.
• Increasing labor costs.

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Prime Ministers Concerns

• Insufficient integration into the world economy
• Weak inter-branch and in-region economic
  integration
  
• Low consumer demand for products and services
• Underdeveloped production social
  infrastructure
  
• General technical backwardness of enterprises
• Absence of effective relations between science
  and production
  
• Low spending on RD

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Gateway to Central Asia

• Central Asian countries have above average
  growth
  
• Kyrgyz Republic (2.7) Tajikistan (7)
  Turkmenistan (9) Uzbekistan (7.3).
  
• Large gas reserves in Uzbekistan and Turkmenistan
  (Global Top 10).
  
• Opportunities with World Bank, EBRD ADB
  infrastructure projects.

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Youll Be Successful If

• You do your homework first.
• You find out who your business partner is.
• You hire competent legal and accounting
  professionals with on ground experience.
  
• Invest necessary time and resources.
• Be prepared to provide after-sales service.
• Let the U.S. Commercial Service in Almaty open
  doors for you!

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Some Tools

• EximBank
• Trade and Development Agency (TDA)
• Business Information Service for the Newly
  Independent States (BISNIS)
  
• Special American Business Internship Program
  (SABIT)

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Case Study Porta-Kamp Intl

• Business Housing for remote work sites.
• Target market Oil gas companies
• What we did
• 12 pre-arranged appointments plus additional
  meetings on the fly as goals changed
  
• Assistance at trade show and conference to gauge
  market
  
• Networking at multiple receptions
• Business plan being developed by Georgetown
  University class

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Case Study WCCO Belting

• Business Agriculture belting
• Target market Agricultural equipment
  distributors
  
• What we did
• Counseling (USEAC BISNIS)
• Trade Mission/Trade Exhibition
• Eight pre-arranged meetings
• Farm tour
• GOK organized roundtable

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If You Dont Believe Me

• The appointments in Kazakhstan were the best of
  the entire trade missionwe secured several
  orders. Tom Shorma, WCCO Belting
  
• Thank you for this report - it's excellent work.
  This is really a valuable service. Dan
  Brents, TVS International
  
• I achieved 100 of the trip objective. Afram
  Melki, Lenel Systems International
  
• The arranged meetings would not have been
  possible with out help from the Commercial
  Service Leonard Trudo, University of
  MissouriSt. Louis
• We are impressed with the U.S. Commercial
  Service Lt. Governor Jack Dalrymple, North
  Dakota

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Contact Information

• The U.S. Commercial Service
• U.S. Embassy Branch Office
• 97 Zholdasbekov St, 15th floor
• Almaty, 480099, Kazakhstan
• Tel [phone] Fax [phone]
• almaty.office.box_at_mail.doc.gov
• www.buyUSA.gov/kazakhstan