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Specifics of non-tariff regulation in Kazakhstan’s trade policy
 
PIIS086919080004609-6-1
DOI10.31857/S086919080004609-6
Publication type Article
Status Published
Authors
Yulia Sudakova 
Occupation: Senior Lecturer
Affiliation: National Research University Higher School of Economics
Address: Moscow, Moscow, Russia
Journal nameVostok. Afro-Aziatskie obshchestva: istoriia i sovremennost
EditionIssue 2
Pages187-201
Abstract

The Republic of Kazakhstan became one of the first members of the Eurasian Economic Union (EAEU) that was formed on January 1, 2015. As a full member, this country had to change its legislation in accordance with the EAEU legal acts. This article is devoted to non-tariff measures (NTMs) applied by the Republicof Kazakhstan in the context of the Eurasian economic integration. The importance of NTM research is defined by the fact that excessive regulatory policies may result in decreased growth rates of economy and overall loss of welfare. UNCTAD’s database (TRAINS/WITS database) was used in order to analyze national NTMs.In total, 239 national actively applied NTMs were analyzed and systematized.Most of them are either import-related technical measures (Technical barriers to trade − TBT, Sanitary and phytosanitary measures − SPS measures) or export-related technical measures. Together they account for approximately 94.8% of applied national NTMs.In addition to the analysis of NTMs in terms of their type and the type of affected products, the author revealed the conformity of Kazakhstan’s national NTMs to basic principles of the World Trade Organization (WTO): most-favored nation (MFN) principle and national treatment clause. Thus, our research determined measures that represent a violation of MFN principle or national treatment clause, so these NTMs may be barriers to trade of the Republic of Kazakhstan with other countries.

KeywordsEurasian Economic Union (EAEU), Republic of Kazakhstan, non-tariff measures (NTMs), trade barriers, most-favored nation principle, national treatment clause
AcknowledgmentSupport from the Individual Research Program of the School of World Economy and International Affairs at National Research University – Higher School of Economics is gratefully acknowledged.
Received31.03.2019
Publication date18.04.2019
Number of characters34071
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Table of contents

NTMS OF THE REPUBLIC OF KAZAKHSTAN: TYPES AND PRODUCTS
NATIONAL NTMS OF THE REPUBLIC OF KAZAKHSTAN AS BARRIERS
1 Over the several past decades the role of tariffs as main instrument of trade policy has decreased. This happened due to the fact that since 1995 many countries1 have joined the World Trade Organization (WTO) and it limited the scope of use of tariffs that they may apply against their trade partners. In addition to this, countries actively started to form regional2 and preferential trade agreements3 that were also aimed at decreasing the level of tariffs that agreeing parties may use against each other. As tariffs decreased countries began to apply more NTMs in their trade policies. 1. 164 countries are members of the WTO as of end of 2018.

2. Reciprocal trade agreements between two or more parties.

3. Unilateral trade agreements granting preferences to specific countries (e.g. developing countries).
2 As most other countries in the world, Kazakhstan adopts NTMs due to the following main reasons: to correct market failures; to protect consumers from low quality or dangerous products; to protect national industries from foreign competition and stimulate local production of goods.
3 The Republic of Kazakhstan was one of the first countries to join the Eurasian Economic Union as initially it was a member of the Customs Union between the Republic of Belarus, the Russian Federation and the Republic of Kazakhstan itself that was formed on January 1, 2010. As for any other EAEU member, NTMs in the Republic of Kazakhstan are introduced via two channels: either via EAEU legislation, or via national legislation.
4 In general terms this article analyses a vast group of NTMs that is defined within UNCTAD’s methodology that is quite different from the point of view of the Eurasian Economic Commission. As such, according to article 46 of the Agreement on EAEU [Agreement on Eurasian Economic Union, 2014] there are 5 types of non-tariff measures: export and import prohibitions, quantitative restrictions, exclusive right to export/import, automatic licensing measures, authorizations (licenses). These measures are listed in Decision of April 21, 2015, No. 30 “About Non-tariff measures”.
5 In turn, in addition to this group of EAEU measures UNCTAD’s methodology includes SPS, TBT, different taxes and financial measures in NTMs. Some of these “additional” measures find their reflection in supra-national EAEU legislation as well.
6 For example, according to paragraph 3 of article 53 of section X of the Agreement on EAEU [Agreement on Eurasian Economic Union, 2014] countries do not apply the requirements of national technical regulations if corresponding technical regulations of the Union are adopted. In turn, national technical regulations can be applied to products included in the list of products that are subject to obligatory requirements (that is given in Decision of Commission of Customs Union of January 28, 2011, No. 526 [Commission of Customs Union, 2011]) and that do not have corresponding Union technical regulations applied to them.
7 Nevertheless, some of the measures are adopted within national legislation of corresponding member states and are applied by these members only. For example, Kazakhstan applies its own VAT (value added tax) and excise tax rates which are considered to be national NTMs. Still, it should be noted that some of national measures hinder integration within EAEU and increase costs for exporters/importers.
8 The current article concentrates more on measures that are adopted only within national legislation and are applicable only in case of the Republic of Kazakhstan and not in case of other EAEU members.
9

NTMS OF THE REPUBLIC OF KAZAKHSTAN: TYPES AND PRODUCTS

10 Application and introduction of national NTMs in the Republic of Kazakhstan is regulated mostly by 5 authorities: the Ministry of Finance, the Ministry for Investments and Development, the Ministry of Agriculture, the Ministry of Energy and the Ministry of Healthcare. Together these authorities cover application of 48 trade- and NTM-related legal acts (approximately 80% of total national trade- and NTM-related legal acts).
11 In total, UNCTAD’s (TRAINS/WITS) database contains classification of 239 nationally applied NTMs in the Republic of Kazakhstan (as of end of 2017). Import-related TBT measures, SPS measures and export-related measures comprise approximately 95.0% of total coded national non-tariff measures (see figure 1).
12 Most frequently used import-related requirements are: TBT labelling requirements (17.15% of the total number of national NTMs) and temporary geographic prohibitions for SPS reasons (9.62% of the total number of national NTMs) (see table 1). As for export-related measures, most frequently used measures are technical measures of category “Export technical measures, not elsewhere specified” mostly consisting of requirements on testing, labelling, packaging, etc. (see table 2).
13
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Figure 1. National non-tariff measures of the Republic of Kazakhstan by chapter, as of end of 2017

14 Notes:
  1. * – Price-control measures – “Price-control measures, including additional taxes and charges”; Pre-shipment inspection – “Pre-shipment inspection and other formalities”; Non-automatic licensing – “Non-automatic licensing, quotas, prohibitions and quantity control measures other than for SPS or TBT reasons”.
  2. Number in parenthesis is the total number of NTMs of the Republic of Kazakhstan classified under specific chapter.
Source: compiled by the author on the basis of WITS/TRAINS database [WITS/TRAINS Database, 2018].

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