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Kazakhstan: Minister Backs Agricultural Subsidies At WTO

Kazakhstan is among the observer states at this week's World Trade Organization (WTO) ministerial meetings in Seattle. One of the debates among delegates centers on the subsidizing of agriculture, which some states view as crucial to their national economies but others consider an unfair trade practice. RFE/RL correspondent Andrew Tully talks with the Kazakh economics minister, who argues that in his country, agricultural subsidies are necessary -- at least for now.

Seattle, 3 December 1999 (RFE/RL) -- Kazakhstan's economics minister asks large agricultural exporters to be patient with his country, saying Kazakhstan finds it necessary to subsidize its farmers for the time being.

Zhaksybek Kulekeyev said in an interview with RFE/RL during the World Trade Organization (WTO) meetings in Seattle that the state of Kazakhstan's farm economy still requires subsidies.

"In the charter of the WTO, special conditions are outlined for developing countries and transition economies, to which Kazakhstan belongs. This means special concessions, especially for industry. We support the necessity of subsidizing agriculture and we have asked our trading partners at negotiations to understand this. We in Kazakhstan support subsidizing agriculture and, in the immediate future, we will continue to hold to this principle. And we want more developed countries such as the US and the EU, which set the rules for world trade, to understand our needs."

But Kulekeyev emphasizes that the subsidies probably will end within five to 10 years, if joining the WTO leads to expanded international trade and improves farmers' incomes.

Large agricultural exporting nations -- including the United States, Argentina, Canada and Australia -- have been trying to get the WTO to eliminate agricultural subsidies over time. Smaller agricultural producers -- including members of the European Union -- say subsidies are essential to keep their farmers' prices competitive.

Just when Kazakhstan might be invited to join the WTO is unclear. Kulekeyev says the talks are complex, and getting even more complex, because they involve so many other nations. Therefore, he says, it is impossible to say when Kazakhstan might gain full membership.

"It is very difficult to name a specific date. Things don't only depend on Kazakhstan. With every passing year, entering the WTO becomes more complicated. Many countries have expressed an increased interest in Kazakhstan, and we will have to hold bilateral talks with more than 20 countries. And this is bound to hold up Kazakhstan's entry into the WTO."

But Kulekeyev says he is confident that his country eventually will join the WTO. And he says the most important benefit will be the ability to settle trade disputes with other countries, using well-defined rules.

To win membership, Kazakhstan must first take steps demanded by key WTO members. In its 1999 country report, the European Bank for Reconstruction and Development (EBRD) states that this will mean the country must stop imposing selective trade barriers.

In the course of this year, Astana imposed a complete ban on the import of some Russian goods and later imposed -- and then lifted -- 200 percent tariffs on selected items from Kyrgyzstan and Uzbekistan.

Neighbor Kyrgyzstan is the only member of the Commonwealth of Independent States (CIS) as of yet to win full WTO membership. One of the key steps it had to take in order to gain entry was to lower tariffs, which are now a uniform 10 percent. As a condition of membership, tariff rates are set to fall further in coming years. Kazakhstan can expect to face similar demands ahead of entry.

Kulekeyev says that despite obstacles to entry, WTO membership is critical to the larger effort to further Kazakhstan's economic and political transition from the communist era.

"We are building a democratic society in Kazakhstan with an open-market economy and therefore, not only we, but all countries who are building an open-market economy are attempting to get into the WTO, since the WTO sets the rules for world trade. We want to join this process and we want to enjoy all the privileges which WTO members have. First, this means the elimination of tariffs and limits on our exports. Secondly, it means obtaining transit rights for our goods on their way to third countries. And it means access to mechanisms for resolving trade disputes through membership in the WTO."

Kulekeyev was asked about the thousands of demonstrators who have turned out on the streets of Seattle this week to protest -- some of them violently -- against the WTO. Like representatives from other WTO candidate states, he says he does not expect the protests to complicate his country's efforts to gain membership in the world trade body.