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 KAZAKHSTAN International Business Magazine №5, 2012
 Kazakhstan and Russia: Course on Innovations

Kazakhstan and Russia: Course on Innovations

Marina Popova

The 9th Forum of Interregional Cooperation of Kazakhstan and Russia was held on September 19 in Pavlodar with participation of Nursultan Nazarbayev and Vladimir Putin. Started in 2003 in Omsk, this event is being held on an annual basis for already nine years. During this time, the leaders, and the political and business elites of the two countries met in Chelyabinsk, Novosibirsk, Orenburg, Ust-Kamenogorsk and Aktobe. In 2012 it was the turn of Pavlodar.

The Forum’s program combined various events aiming at seeking of innovative ideas to expand mutual cooperation between our countries. Thus, a separate Kazakh-Russian business forum was devoted to the issues of cooperation in the field of sustainable development and high technologies. According to the results of this forum the portfolio of joint projects included 27 agreements worth about $2 billion. In the framework of the international innovations exhibition nearly 190 companies from Kazakhstan and Russia, which have also signed a number of contracts totaling to more than $322 million, presented their achievements in this sphere.

The President of Kazakhstan in his welcome speech placed a special emphasis on the particular relevance and importance of the Forum’s themes. “Only for the past two years, 440 new production facilities to the amount of $12 billion have been launched in Kazakhstan under the industrialization program. We plan to implement more than 700 industrial and innovative projects worth $77 billion until the year 2020. Significant support and contribution are provided from the Russian partners in terms of innovative industrialization of the economy.”

In turn, the President of Russia Vladimir Putin stated that the current year is a turning point for Russia and Kazakhstan. “This year marks the 20th anniversary of diplomatic relations between our countries. Over these years we have built a strong foundation of bilateral relations in the spirit of strategic partnership and cooperation. The legal framework has been established and is constantly improving, and political contacts have been set and are developing at all levels. Innovative cooperation is an important direction of bilateral partnership. This is our strategic direction. If we combine our efforts to implement such projects, the outcome would be more significant. This is the aim of both the Customs Union and the Common Economic Space.”

From LADA to Baikonur

One of such joint projects will be the establishment in the East Kazakhstan oblast of a car production facility aiming at producing of up to 120,000 Russian cars annually. The volume of investments in this project is estimated at $400 million. As the President of AvtoVAZ OJSC Igor Komarov stated during the Forum, this project became possible owing to the favorable conditions set by the coordinated, industrial, customs and investment policy of the two states. According to him, the project for establishment of the new LADA car assembly plant, as well as cars of other brands, is the largest private initiative in Kazakhstani engineering.

Another joint project is the production in Kazakhstan of civil helicopters. As Vladimir Putin noted, “The engineering is our priority, in terms of new technologies. In the coming years, we plan to build a full cycle car plant in Kazakhstan and are interested in joint production of K-226 civil helicopters. Implementation of these programs will include new production chains and improve the quality and scope of industrial cooperation between the countries.”

Two innovative projects are scheduled for implemented in Kazakhstan by the companies from Nizhny Novgorod region. These are the release of intraocular lenses and production of polymer-bitumen insulation products. In addition, the Joint Institute for Nuclear Research of Dubna, Russia, jointly with the Interdisciplinary Research Complex of the Eurasian State University and the National Nuclear Center of Kazakhstan, are currently implementing projects related to the creation of conceptually new materials.

A silicon cluster is planned to be developed in the Omsk region with the participation from the Kazakh side, which involves the formation of a full production cycle, from raw material supply from the Kazakh deposits to the finished product – polycrystalline and metallurgical silicon as well as wafers for solar energy, microelectronics and high-accuracy optics. Our country is also interested in Omsk equipment for ground infrastructure GLONASS and GPS. ThisRussian development is plannedto beused for monitoring ofoilandgasfields, as well as thedeployment inKazakhstan of groundinfrastructure ofglobalpositioning.

Cooperation in the space field was not left unattended. “Baikonur should become an international innovative brand and a symbol of qualitatively new stage in promotion of our bilateral relations”, – said the Head of State. “For conduction of joint researches in the field of peaceful use of space, we could create a new and unique platform of scientific and technological cooperation – Baikonur Innovation Forum.” In keeping with the joint statement on space, adopted by the two Presidents in June 2012 in Astana, Nursultan Nazarbayev outlined the need to develop a long-term program on sharing the Baikonur cosmodrome and space cooperation. “It is important to include in this program the issues of modernization of the city and creation of infrastructure, meeting the modern requirements.”

Golden triangle

The integration should concern the three elements of the "knowledge triangle" – education, research and innovations. And we have positive examples of such cooperation. This is a joint fund of nanotechnologies (between “Kazyna Capital Management” and “Rusnano”) and the Center of High Technologies in the EurAsEC. We must move on. Nursultan Nazarbayev noted that we should not rely on help from the outside in this area and have to grow professional pool for mastering global experience and promotion of the science by ourselves. “We are interested in a wide student exchange, training and retraining of specialists in technical and other fields. We are ready to expand cooperation with Russian universities and research institutes, especially in new technologies area,” – said Nursultan Nazarbayev. This process is being actively developed. Apart from the fact that the Kazakh youth is studied today in higher educational establishments of Novosibirsk, Barnaul, Omsk and other major border cities of Siberia, our teachers and doctors pass their practical training there as well.

Speaking at the Forum, the President of Kazakhstan offered to follow the European countries’ experience in creating a single research network with participation of universities, research centers and business. “Effective commercialization of scientific research is the ground for a competitive industrial production. I am convinced that Kazakhstan and Russia jointly could form a full-term technological and industrial alliance.” And as an option for such cooperation, the President invited Russian companies to participate in the work of the innovative park in Almaty and emerging centers of agricultural innovation and in creation of a science city in Kurchatov. The president also suggested a partnership between the Skolkovo innovation center and the new Nazarbayev University. “Nobody from the abroad will provide us their new technologies, so we need to cooperate for creation of such innovations here at home, together.”

Results and agreements

A number of intergovernmental documents were signed in the presence of the two presidents. Among them, the Protocol of Amendment to the Agreement between the two governments On Trade and Economic Cooperation in the Field of Delivery of Oil and Oil Products to the Republic of Kazakhstan dated December 9, 2010. This document, which creates the conditions for duty-free deliveries of Russian oil products to Kazakhstani domestic market in the amount approved by the indicative oil balance in the territories of the two countries, was signed by the Minister of Energy of Russia Alexander Novak and the Minister of Oil and Gas of Kazakhstan Sauat Mynbayev. The protocol provides for the mechanisms of reimbursement of lost revenues of the Russian federal budget by means of counter duty-free deliveries of Kazakh oil, the methodology of calculation of their volumes and the procedure of implementation.

Less formal, but not less important work was in full swing in the other activities of the Forum: the exhibition, the plenary sessions and the exchange of opinions, the signing of bilateral memoranda and agreements both between individual companies and the border regions, involving twelve Russian regions (including the Republic of Altai, Altai territory, Astrakhan, Volgograd, Kurgan, Novosibirsk, Orenburg, Omsk, Samara, Saratov, Tyumen and Chelyabinsk regions) and seven regions of Kazakhstan (including Aktobe, Atyrau, East Kazakhstan, West Kazakhstan, Kostanay, Pavlodar and North Kazakhstan regions).

In total, over 250 agreements, protocols and memoranda on cooperation were signed between the above mentioned regions, to be further complemented by joint activity plans. There are more than 400 joint ventures operating in the border area, and in general 76 regions of Russia maintain trade and economic relations with Kazakhstan on a permanent basis. According to the Federal Customs Service of Russia, in the first half of 2012, the trade turnover between the countries amounted to $10.1 billion, an increase compared to the same period in 2011 by 0.5%. While Russian exports grew by 1.6% – to $6.4 billion, import from Kazakhstan decreased by 1.5% – to $3.7 billion.

The business agreements also yielded results in the form of a memorandum of cooperation between Inter RAO UES JSC and Samruk-Energy JSC which provides for construction of the fourth energy generating set of Ekibastuz GRES-2 with capacity of 600 MW. This project will ensure the development of generating capacity, electricity production efficiency, energy security of Kazakhstan, repayment and return on investment, as well as contribute to improvement of partnership between the two companies. It should be noted that at present the construction of the third set, performed in the framework of the similar memorandum signed previously, is under implementation. The second power generating set was set into operation 20 years ago.

Summarizing the forum results, the President Nazarbayev noted that the Common Economic Space and the Customs Union contribute to consistent strengthening of cooperation between Kazakhstan and Russia. “Today, many of the barriers that existed between the two countries at the customs and at the border are eliminated which helps to actively develop joint productions.”

P.S. Evgeniy Kuivashev, the Governor of Sverdlovsk region, picked up the torch of the next 10th Forum of Interregional Cooperation of Russia and Kazakhstan to be held in Yekaterinburg.

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Nabucco: a Point of No Return   Sergey Smirnov 
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· 2012 №1  №2  №3  №4  №5  №6
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· 2000 №1  №2  №3

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