Deputy Chairman of NCE RK "Atameken" Dana Zhunusova believes that there should be an alternative for transit of cargo through Russia, following from Ukraine to Kazakhstan

- Dana Beysenovna, please tell us about what is happening.

- As you know, last December the Russian Federation by presidential decree suspended the of the Treaty on free trade zone in respect of Ukraine. In addition, from 1st of January of the same year the goods, following from the territory of Ukraine, were also included in the list of "sanctioned" products in accordance with Presidential Decree #560 dated by 6^th of August 2014.

In order to protect its own market from re-export of goods imported from the territory of Ukraine to the territory of Kazakhstan, the Russian Federation on 1^st of January of the current year adopted another Decree, which introduced a special procedure for the import of goods from Ukraine to Kazakhstan in transit through Russia.

It should be noted that the order of entry imposed a number of requirements on our business: import of goods should be carried out only through certain checkpoints on internal and external borders; on a certain route, established by customs authorities; using GLONASS seals on all vehicles and cars; under customs escort and the repeated customs inspections.

Despite a number of conditions, set by the Russian side, the domestic carriers and importers did not commit any violations: according to SRC of MF RK all goods were delivered to the stated destinations in Kazakhstan in compliance with the invoices.

At the same time the Decree, which defined a new procedure for import of goods from Ukraine to Kazakhstan, ended on 1^st of July 1 of this year, and knowing what risks the possible changes can bear for business, NCE has already begun the explanatory work on 20^th of June. The relevant newsletters were spread around the media and the data base of entrepreneurs, that work with Ukrainian counterparts, which is available at NCE RK, the official requests were also sent to the Government of Kazakhstan and the Russian Federal Customs Service.

However, despite all the efforts on the part of NCE, up to 4^th of July this year there was no confirmed information from the Russian side regarding a taken decision on the transit of goods from Ukraine.

- What has happened?

- On 1^st of July  this year was signed a new Presidential Decree, which amended the previous decree on the import of goods from Ukraine to Kazakhstan. New Decree in fact imposed a ban on imports of all goods from Ukraine to Kazakhstan and Kyrgyzstan through the territory of Russia. 1908 items of FEACN are permitted to be imported through the territory of Russia, the import duty of which in the Common Customs Tariff is set at a rate 0%.

It is worth noting that NCE together with business has already analyzed authorized headings, subject to a zero rate of import duty according to CCT of EAEU. The analysis indicates that 95% of allowed goods to be imported are not imported from Ukraine to Kazakhstan and Central Asian countries.

As it has been repeatedly stated by NCE, timely information of the business is an effective tool to prevent and to minimize negative impacts from all sorts of innovations. This time we have faced once again the situation where the absence of confirmed data once again has led to the delay and wait of Kazakh vehicles at the Russian border.

- How many machines wait at the border? Why they are not allowed to pass? When will the issue be resolved?

- Information on the waiting vehicles and wagons changes hourly. According to recent data, which came from KazATO and entrepreneurs, more than 20 vehicles and 80 wagons with goods, following to Kazakhstan, are waiting in Smolensk. The Russian customs authorities send back vehicles and wagons, which arrived in Smolensk after 30^th of June.

"Atameken" officially appealed to the State Revenue Committee of MF RK with a request to assist in the passage of vehicles and wagons, which arrived in Smolensk before the entry into force of the new decree. Within the framework of inter-agency cooperation the Russian Federal Customs Service has informed Kazakhstani customs authorities that the 25 vehicles that have arrived in Smolensk before 1^st of July were already registered and moved to Kazakhstan. As for wagon, the information is being specified.

All vehicles and wagons that have arrived in Smolensk on the night from 30^th of June 30 to 1^st of July 1 this year are checked for import duties, and the decision will be made according to the results. In case if the goods are zero rated in compliance with the CCT of EAEU, the transport is registered and allowed to pass  to the Republic of Kazakhstan, if not, then the transit declaration is closed, and all the transport including vehicles, and railway wagons are sent back to the point of departure.

- What is the problem?

- Currently, in the Russian Federation in respect of a number of countries are applied special unilateral economic measures. These measures are not regulated by the legal framework of the Union and are the sovereign right of each Member State.

However, since 2010 Belarus, Kazakhstan and Russia, and more recently, and Kyrgyzstan are a single customs territory, which in turn affects the import of goods into the customs territory of the Union and compliance with the prohibitions and restrictions imposed by one of the states of the Union.

For more than 1.5 years (August 2014) the Eurasian Economic Commission and the competent authorities of the Member States made repeated attempts to resolve the problems with transit through the territory of Russia. In December 2014 was adopted a recommendation of the Board of EEC, according to which, the sanctions policy should not apply to products that follow into the territory of the EAEU under the customs procedure of customs transit.

In 2015, began work on the development of the mechanism of interaction of states of the Union during the introduction of "sanctions", today the system of traceability of goods from the moment of entry to the final consumer is discussed.

However, there are no changes in the situation with the transit of goods through the territory of Russia. It is hoped that in the near future the authorized state bodies of the Union will be able to find a consensus and to make a decision that will minimize the negative impact on businesses and eliminate the additional financial burden for imported goods.

- How is work done?

- At present, the Government of the Republic of Kazakhstan has sent a request to the Russian Government concerning the consideration of the possibility of transit through the territory of the Russian Federation of a number of strategically important goods. This category includes only industrial goods, on which critically depends the technological process of domestic production. The list does not include food products, which are in the list of sanctioned goods.

At the same time, I pay attention that Russia's decision after consideration of our request, does not guarantee the free passage of our goods. In this regard, I ask all businesses to evaluate independently the risks and financial costs due to the current situation.

On our part, on a regular basis were inform business about the current situation through our official website palata.kz  and mail-out of  importers, who have concluded contracts with Ukrainian counterparts. The Department of economic integration organized a hotline for entrepreneurs, regarding the transit of goods from the territory of Ukraine.

I note that a huge number of calls come and it is difficult to respond physically to all requests, taking into account the limited human resource capacity.

Key questions are related both to import duties and travel opportunities. Therefore, once again I want to note that the goods, the rate of which is higher than 0% according to the CCT, are prohibited from being imported into the territory of the Russian Federation.

Particular attention is drawn to the fact that the Decree of the Russian Federation, which puts a ban on importation of goods from Ukraine, applies only to the territory of Russia, and does not regulate the transportation of goods through the territory of the Republic of Belarus. That is, entrepreneurs must realize that entering the customs territory of the Union through the external border of the Republic of Belarus, there is a risk of the return of vehicles from the territory of the Russian Federation where, in fact, will be held the identification of the CCT of EAEU according to the new requirements. Therefore, we ask the business prior to the proposed carriage of any goods from Ukraine to Kazakhstan to make sure that the rate of import duty on this product is 0%, according to the Common Customs Tariff of EAEU.

For reference:

Common Customs Tariff of EAEU - is a set of rates of import customs duties applied to goods imported into the customs territory of the Eurasian Economic Union from third countries, classified in accordance with the Single Commodity Nomenclature of Foreign Trade of the Eurasian Economic Union (FEACN of EAEU).

To find out the size of import duties on goods of interest, according to the latest edition, you need to go to the website of the Eurasian Economic Commission on the following link: http:

//www.eurasiancommission.org/ru/act/trade/catr/ett/Pages/default. aspx

- What do you recommend to our entrepreneurs?

- We have repeatedly talked about the alternative route of delivery of goods from Ukraine to Kazakhstan through the ports of the Black and Caspian Seas. Today, this issue is highly relevant. Yes, I must honestly admit that not everything went smoothly on this route, but, nevertheless, the prospects and potential of the route through the port of Aktau is very high.

It is now about 70% of goods from Turkey to Kazakhstan and Kyrgyzstan follow the specified route. Now we propose to use it for the transport of goods from Ukraine.

Of course, a major factor in the choice of the route of cargo delivery is a convenient logistics, which will allow to achieve optimal delivery time and transportation cost. In this regard, an alternative route through the ports is not competitive with the overland route through Russia. But we can work in this area and through joint efforts of the Governments of the countries of the Trans-Caspian route, railway administrations and port authorities, as well as businesses to minimize delivery times and freight costs.

I believe that today we need to increase the competitiveness of the alternative route. We can’t depend entirely on a historical route. In this situation, we call for the development of the possibilities of using the Trans-Caspian route. To do this, we need to clearly define the problematic points and barriers of the delivery in order to find their conceptual solutions: reduction of tariffs for transportation, reduction of the time, improving the quality of delivery of goods, and more.

Moreover, taking into account the current situation, NCE proposes to time alternative routes in order to increase the competitiveness of the route. In our opinion, with the assistance of all those involved and interested state bodies and organizations, we can achieve some success in this work.

In conclusion, it should be noted that, according to the Statistics Committee, amid all the vicissitudes that take place with the transit of goods and their delivery to Kazakhstan, domestic producers increase volumes of their production. During the 1st quarter of this year the rise of production in such groups of goods as meat and meat products 9%, cheese and cottage cheese - 13%; chocolate - 47%; confectionery - 6%; windows, frames, doors, wood - 138%. Of course, this fact, is a positive fact and says about the automatic import substitution of some products, due to the influence of external factors.