Slovakia and Kazakhstan are in Search of Ways of Mutual Cooperation
Dushan Podgorsky, Ambassador Extraordinary and Plenipotentiary of the Slovak Republic to the Republic of Kazakhstan, answered the Kazakhstan international business magazine's questions
Dushan Podgorsky, Doctor of Engineering in Satellite and Radiolocation Meteorology, former head of two air companies and the Slovakia National Standards Organisation.
What is your assessment of the current state of economic relations between Slovakia and Kazakhstan, particularly in trade and investment?
Unfortunately, our countries have not yet even realised 10% of their business cooperation potential. In particular, the trade between our countries is underdeveloped and we are only at the stage of searching for partners for investments and joint projects.
Today, the turnover of trade between our countries is only $64m. At the same time, recent growth (as early as in 2004 Kazakh imports to Slovakia were $13.92m and Slovak exports to Kazakhstan were $25.66m) shows the potential for expanding business relations.
Slovakia exports tyres, conveyor belts, power supply systems, machines and pharmaceutical products to Kazakhstan. Kazakhstan exports gas, ferrous metals and oil to Slovakia.
Cooperation in mechanical engineering is very important for relations between the two countries. Taking into account that Volkswagen, Peugeot, Citroen, Hyundai and Kia companies are planning to produce more than 1 million cars in Slovakia for 2007, small and medium-sized enterprises have been established in Slovakia to produce and supply spare parts for their plants. Our experience in this domain may be useful in developing the car industry in Kazakhstan.
In this context I would like to mention the Kazakh branch of the Slovak Matador, which supplies tyres produced in Ust-Kamenogorsk for Skoda cars. These tyres may also be used for tractors produced in Kazakhstan. ZTS Martin, the biggest Slovak company in this domain, is planning to produce these tyres in Kazakhstan.
Tisovetz, a manufacturer of road and excavating machines, is searching for Kazakh partners to supply its products.
Cooperation between Kazakhstan and Slovakia in health care is of particular interest. Recently, representatives of two Slovak medical universities visited Kazakhstan. One of the main purposes of their visit was to establish a branch of the Slovak Medical University in Astana to provide post- and pre-graduate training for physicians and nurses and issue them with European diplomas.
Could you name major investment projects that are being carried out in Kazakhstan with the involvement of Slovak capital?
Today, only one investment project is being carried out in Kazakhstan with the involvement of Slovak capital: Nafta Kbely is a shareholder of Anaco in Aktau. This project is looking at exporting light Caspian oil to Baltic countries.
Another field of Slovak interest is the nuclear power industry. The Slovak energy supply is based on nuclear fuel: today, more than 65% of its electric power is produced by nuclear power plants. That is why joint projects with Kazatomprom National Company may have a very good outlook in the near future. Slovakia is ready for engineering and supplying some equipment for a future nuclear power plant in the Balkhash region. Our Trnava Research and Development Institute may also teach the plant's personnel.
I would like to note the promising outlook for cooperation between Slovakia and Kazakhstan in the construction industry. As Slovakia has a rather extensive network of design organisations specialising in housing, road and railways construction, we are ready to carry out various construction projects in Kazakhstan, each in accordance with European standards.
Slovakia's offer to Kazakhstan may consist of establishing medium-sized enterprises to manufacture construction materials, assemble specialised freight and passenger railway cars and produce simulators for training flight personnel and air traffic control. And as for cooperation in environmental protection, we are ready to supply Kazakhstan with different monitoring systems (ranging from seismology to atmosphere and hydrosphere pollution) and assist in the production of waste processing equipment.
Now the Slovak part of the turnkey project on the construction of Power Plant 3 in Astana is being completed and is carrying out the overhaul and repair of old power plants to furnish them with waste processing equipment. A Kazakh-Slovak joint company that will produce solar panels and mini-hydropower plants is being established. A Kazakh-Slovak project to construct water treatment plants equipped with nanofilters is under discussion.
As for the Slovak embassy's participation in this process, I would like to refer to the technological park project in Karaganda. Through cooperation with the company Kazakh Umit, we want to create a technical centre for Slovak machine engineering and construction companies to produce environmentally friendly paints diluted with water, assemble solar panels, etc. We hope that the final decision on this project will be made during President Nursultan Nazarbayev's visit to Slovakia.
Is Slovakia interested in Kazakh investors?
Yes, we are interested in your investors. Slovakia has many sectors that require foreign investments. For example, purchasing one of the best hotels in Bratislava or developing Slovak mountain resorts would be a good investment for Kazakh businessmen.
I think that Kazakh involvement would have a promising outlook for creating an air cargo centre in Central Europe to transport Kazakh exports to EU countries. This centre could be created on the basis of the Bratislava airport, for example, located at the intersection of air routes, roads and railways that provide access to all of Europe.
What positive changes, in your opinion, will occur after the forthcoming visit of the Kazakh President to Slovakia?
President Nazarbayev is due to visit Slovakia for the first time. This official visit has been planned three times but cancelled due to various force-majeure circumstances. Ivan Gashparovich, the Slovak President, and the new Slovak government are very interested in this visit, which is due to be made this November.
The forthcoming visit should see Nursultan Nazarbayev signing six intergovernmental and interdepartmental agreements and some memorandums to protect and support investments, prohibit double taxation and establish rules for commercial, scientific and technical cooperation. Slovak-Kazakh cooperation in education programmes, such as Bolashak, and research projects (in particular, in medicine) is also envisaged.
I should note that the Slovak people's interest in your country constantly grows due to Kazakhstan's economic progress and its influence in Central Asia. As an independent state, Slovakia is three years younger than Kazakhstan and is still developing its own system of international trade, searching for new partners, etc.
The third meeting of the intergovernmental commission on commercial, scientific and technical cooperation is planned for the day before the visit. This meeting will determine our joint strategy and objectives.
When starting work in Kazakhstan, you noted that Slovakia was ready to share its experience with Kazakh businessmen and help them to export Kazakh products to EU countries. In particular, you mentioned the cooperation in technical regulations, such as standardisation and the certification of products and services.
During the seven years that Slovakia has been in the European Union, it has gained a great experience in adopting European standards, and so we are ready to share that experience with your country. As Kazakhstan is expecting to enter the WTO, it needs to learn that experience in order to remove barriers and make its market more open.
In this context I want to note that the Slovak National Accreditation Service and the Kazakh KazInMetrconsulting company have already signed a contract for the accreditation of three national laboratories on disease prevention, customs and metrology. This project will be the basis for Kazakhstan to enter the International Laboratory Accreditation Organisation in 2007.
In addition, 20 Slovak notification testing plants in all spheres of industrial and agricultural production recognised by the European Union are also ready to share their experience and train your specialists.
In addition to its intention of entering the WTO, Kazakhstan set an objective to be among the world's 50 most competitive countries. What would you advise us, taking into consideration this ambitious objective?
Our advice is very simple: you need to improve the quality management system both at state and business levels and apply ISO-9000 and ISO-14000 environment management standards.
Moreover, it is very important that Kazakh testing laboratories are accredited in accordance with relevant ISO-17025 standards, and that the product certification system is established in accordance with the EU's technical regulations.
The Slovak Republic has already passed through the difficult process of harmonising all standards in all industries.
What were the most important advantages your country gained by integration into the European Union? How do you see the new geopolitical role of Slovakia?
Today, our foreign trade is aimed mainly at the EU countries. After we entered the European Union we started to receive financial means to support underdeveloped Slovak regions, raise the competitive capacity of our agricultural industry, and give us the possibility of participating in international scientific and technical programmes. As for geopolitics, we would like to be a country that serves as a bridge between the European Union and CIS countries.
Interviewed by Gulmira Arbabayeva
Slovakia is a central European country partly covered with the Carpathian and Tatra mountains. It borders the Czech Republic and Austria in the west, Poland in the north, the Ukraine in the east and Hungary in the south. The total area is approximately 49,000 km2; the population is 5.4 million. The capital is Bratislava (500,000 people). The official language is Slovak. The majority religion is Catholicism. The currency is the Slovak koruna (one euro is about 38 korunas). The Slovak government plans to replace the koruna with the euro by 1 January 2009.
In 1918, following the break-up of the Austro-Hungarian Empire, the Czech and Slovak people formed the Republic of Czechoslovakia. In 1993, Slovakia and the Czech Republic separated and declared themselves independent states. Following the break-up of the Czech and Slovak Federal Republics, Slovakia continued reforming the economy to strengthen the social services and government regulation. The conversion of the armament production industry was a big problem for the Slovak economy. Thirty five machinery plants, manufacturers of military equipment for the Warsaw Pact countries, got into difficulties.
Today, one of the major sectors of the Slovak economy is the industry, accounting for more than 27% of GDP. In 2003, the industrial production was 1,089.9bn Slovak korunas (at current prices) with a 16.3% increase as compared to 2002. The main Slovak exports are semi-finished products for secondary industries, machines and chemical products. The main Slovak imports are machines and various fuels. Germany, Austria and the USA are major investors in the Slovak economy.
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