Customs union creates new rules, new problems

Kazakhstan’s entrepreneurs are preparing for tariff-free competition with Russian corporations - and not all of them welcome the idea.

“The Russians and Belarusians will export products superior to ours. Duty-free, they will cost (less than what) we charge here”, said Amir Safarov, owner of a furniture workshop in an Almaty suburb. “What are we to do now -- go out of business?”

The rules of the Customs Union of Kazakhstan, Russia and Belarus are to take effect July 1, although Belarus’s entry remains in doubt since it and Russia are disputing energy prices.

The free-trade zone with Belarus and Russia came into being January 1, and July 1 will mark the lifting of non-tariff regulatory barriers, such as veterinary and sanitary requirements, licensing, technical regulations and customs clearance, said Zhanar Aitzhanova, Kazakhstani minister of economic development and trade.

The government expects the new customs union to benefit Kazakhstani businesses and consumers. Some are sceptical, however.

Gorkhmaz Allahverdiyev, a dairy plant owner from Pavlodar, said that he is worried about Kazakhstani products in the Russian market.

“I don’t think our produce will sell well in Russia — but the Russians, who have better equipment and technology, will have a competitive advantage in the Kazakhstani market”, he said.

Muratbai Khairushev, head of the Mangistau Oblast branch of the Independent Association of Entrepreneurs, also worried.

“With the growing prices of accessories, production will become more expensive, and so will the end product”, he said.

Mangistau Customs Control Department Seaport Chief Yersain Alimbayev disagreed. Kazakhstani businesses will have an incentive to produce better goods, while getting access to new markets, he said.

Several products will be competitive in Russia, Ruslan Sultanov, general director of the Trade Policy Centre under the ministry of economic development and trade, said, including “pipes, X-ray equipment, condensers, spare farm equipment parts, crankshafts, and food products”.

The new trade regime will eliminate barriers that used to plague Kazakhstani exporters trying to sell to Russia now will go away, Sultanov said.

One such barrier – a discrepancy in transportation rules – will also disappear, Universal Logistics technology director Dauren Bimov said.

“Our companies exporting goods to Russia can keep their railcars on Russian soil for only 90 days, and the return of cars is strictly controlled”, he said. “Meanwhile, Russian railcars are allowed to stay for a whole three years in Kazakhstan and haul freight in this country while awaiting profitable back orders”.

The new Customs Union will impose the same 90-day limit on Russian railcars, he said. “Today, (Kazakhstan imports) light industry goods without declarations, certificates or invoices and charges a customs duty amounting to € 0.60 per kg of merchandise”, said Lyubov Khudova, president of Light Industry Association. “With our market so open to imports, the textile industry in Kazakhstan meets only 8% of domestic demand. … We are prepared to compete and raise domestic production to the 30% level by 2014”.

Kuanyshbek Alenov, a board member at the National Union of Entrepreneurs and Employers, said the union will create more choices for consumers in Kazakhstani markets, but added that businesses must adapt.

“Owners of large businesses will find it easier to work with decreased transportation costs within the Customs Union countries. Medium-sized and small businesses are not so enthusiastic, though”, he said. “To stay afloat, they will have to modernise production, enlarge the range of products, improve quality and offer new services, which is not always possible”.

In 2009, Kazakhstan’s imports from Russia equalled 31% of the total (US $8.9 billion) and from Belarus 1.3%. Exports to Russia equalled 8% (US $3.5 billion) of the total and to Belarus 0.1%.

Zambia: COMESA making progress towards Customs Union launch

The Common for Eastern and Southern Africa (COMESA) says tremendous progress has been made towards the launch of the regional Customs Union.

The committee on Trade and Customs which met in Zimbabwe recently said the regional bloc agreed on the need for member countries to put in place practical and comprehensive programmes that would speed up the implementation process by the set deadline of 2012.

According to the e-COMESA Newsletter made available to ZANIS in Lusaka Sunday, there is progress in key areas and several recommendations have so far been made to ensure that the process is quickened.

The committee has since appealed to member countries that have not joined the Free Trade Area (FTA) to join as soon as possible since COMESA was now a Custom Union.

The meeting also highlighted a few milestones in the area of Non Tariff Barriers (NTBs) further urging focal points in member states to ascertain the report on NTBs and help in eliminating existing NTBs. With regards to the Customs Union, the committee welcomed the improvement and recommended that member countries needed more time to examine the thresholds for sensitive products.

The meeting also advised the members to quickly submit their list of sensitive products in order for the committee to finalise the study that would be sent to member states before an intergovernmental committee meeting is held in August this year.

On the relationship between the regional integration agenda and multilateral trading system, the committee recommended that there was need to develop analytical work and develop a regional strategy on World Trade Organisation (WTO) issues.

It said this is in order to articulate coherent regional positions therefore reviving the COMESA working group on WTO. The committee further endorsed the initiative of focused training in institutions in member states on regional integration subjects. The meeting was attended by representatives from the 19 COMESA member states and representatives from WTO.

And Malawi offered to host the next meeting of the Committee meeting on Trade and Customs. Zambia is a member of the regional bloc and the country houses its headquarters.

UNIT IX.

An Airport Program That Makes Traveling (Gasp!) Easier

With Transportation Security Administration screening techniques getting extra personal of late, it’s tempting to think that the airport experience only goes from bad to worse. But Global Entry, the latest “trusted traveler” program from the Customs and Border Protection agency, is that rare beast: a government initiative that is making international travel more convenient.

I first heard about Global Entry from an immigration agent at Logan Airport in Boston. He explained that at 20 American airports, Global Entry members returning to the United States can check themselves back into the country at an ATM-like kiosk. No lines, no paper forms — though some online preparation is needed. (In addition to U.S. citizens and permanent residents, Dutch citizens are eligible via a reciprocal program, with more countries to follow.)

As a professional pilot, United States expat and frequent leisure traveler, I’m familiar with the changing rules and growing lines that often mar both ends of a journey. Yet I’d assumed that fast-track arrival programs like Global Entry were geared to an elite of globe-trotting executives. But as I’d just experienced, the Customs and Border Protection agency is encouraging the rest of us to sign up.

I started my application online, with a detailed questionnaire that covered past addresses, travel history and old traffic violations. It will come as no surprise that this government Web site isn’t at all user-friendly: prepare your documents and a tray of snacks before sitting down. When entering documents such as a passport, be wary of clicking the “Next” button, which only occasionally means what it says. And resist the temptation to select, as your current place of residence, the U.S.S.R., the German Democratic Republic or Antarctica’s Dronning Maud Land, which are all, for some reason, active options. And make sure to pay the fee — $100 for five years.

Next is a quick interview, during which your fingerprints are scanned. It’s straightforward to schedule this before your next flight from a domestic airport that offers Global Entry, or at certain Canadian airports (I did mine before a flight from Vancouver). Various computer glitches kept me there for well over an hour, but final approval followed almost immediately by e-mail.

I figured there would be no more fitting venue for a test-drive than the Ellis Island-meets-Mordor immigration hall at LAX. On a recent trip, I scurried past the huddled masses and headed straight for a Global Entry kiosk. I scanned my passport and fingerprints, grabbed the receipt that replaces the old paper customs declaration and made my grateful escape into the warm Southern California evening. Between disembarking the plane and sitting down on the rental car shuttle, I barely stopped walking.

The verdict: if you travel abroad more than once a year, or frequent a particularly congested airport, enrollment in Global Entry is well worth your time, money and fingerprints.

Date: 2016-01-14; view: 583