040402`

Vol. 2, No. 17, May 22, 2002

Politics

President Bush sends address to upcoming Kazakhstan conference in Kansas

Rep. Edolphus Towns: "Kazakhstan is the strongest U.S. ally in Central Asia"

Kazakhstan's Senate ratifies agreement with U.S. on destruction of missile silos

Preparations are under way for the first CICA summit

Economy

Kazakhstan, Russia sign agreement to divide North Caspian

U.S. envoy welcomes Kazakhstan-Russia Caspian agreement

Industrial output grows in first four months of 2002 ...

...as unemployment shrinks in April

POLITICS

President Bush sends address to upcoming Kazakhstan conference in Kansas

President George W. Bush, citing the need to "promote trade, investment and good relations between our two countries", sent an address on May 7 to participants of the upcoming international investment conference "Kazakhstan: The Premier Market for Investment and Trade", to be held in Kansas City, Kansas, July 1st and 2nd. Mr. Bush thanked Senator Sam Brownback (R-KS) "for his role in making this event possible".

"The United States deeply appreciates Kazakhstan's assistance in the war against terrorism," President Bush said.

"As a growing nation in strategically important Central Asia, Kazakhstan has the potential to be an engine of prosperity and stability for its region and beyond. I am confident that Kazakhstan will realize this potential as it develops the political and economic institutions that will help bring a better life to its people. These efforts include the wise investment of energy revenues to foster balanced economic growth," Mr. Bush declared.

"Kazakhstan's energy sector can also strengthen global energy security if it continues to attract and maintain foreign investment.

"As investment conditions improve, Kazakhstan's agricultural, transportation, and telecommunications industries can also become catalysts of regional economic growth and partners for U.S. companies," the President said, commending conference participants for "working toward these goals, which expand opportunity and contribute to a brighter future for countless people."

The conference is being organized by the Government of Kazakhstan and CWC Group with the support of the office of Senator Sam Brownback. High-level Kazakh and U.S. government delegations, executives of American, European and Latin American companies, banks and think tanks are expected to attend. The conference will focus on new investment opportunities in oil and gas, agriculture, transportation and telecommunications, and services and processing sector, and will provide opportunities for direct business-to-government contact and exchange.

Rep. Edolphus Towns: "Kazakhstan is the strongest U.S. ally in Central Asia"

Rep. Edolphus Towns (D NY) placed a statement in the Congressional Record on May 14 saying that Kazakhstan has become a "staunch ally with strong economic and political ties to America". He called Kazakhstan "the hope for political stability and prosperity in Central Asia" and urged Congress to support Kazakhstan for reasons of "our shared ideals of democracy, a better life for all peoples and the uprooting of terrorism".

"Kazakhstan, with its developing society and emphasis on democracy, is an ideal source of the help the Afghans so badly need. Kazakhstan can be a model for an emerging society and stable economy in Afghanistan," Mr.Towns, a prominent minority member of House Energy and Commerce Committee, said speaking of the need to pool international resources to help rebuild war-ravaged Afghanistan.

Kazakhstan has already been providing humanitarian assistance to the Afghan people. Three thousand tons of Kazakh grain have already been delivered to that country. The U.N. World Food Program has also signed contracts for 100,000 tons of grain to be shipped into this country.

"Beyond this, the government of Kazakhstan is building a database of individuals who have special skills needed for the rebuilding of Afghanistan and have volunteered to help," Rep. Towns noted. "You might call it a "Central Asian Peace Corps."

"These activities, at both the government and the individual volunteer level speak volumes about the similarities between Americans and Kazakhs. Both respond quickly to a neighbor's need," Rep. Towns said commending Kazakhstan's efforts to help develop a stable Afghanistan and a secure region.

Referring to the Kazakhstan President's recent state of the nation address, Rep. Towns welcomed the fact that "President Nazarbayev foresaw closer ties with the United States and even greater emphasis on the development of democratic ideals and the civil society."

Mr.Towns welcomed the recent granting to Kazakhstan a market economy country status, citing many years of successful partnership between Kazakhstan and the United States in various fields, including the development of Kazakhstan's vast oil and gas reserves as alternative sources of energy for the U.S. and world markets, and fostering a democratic society in the republic. He further called for the repeal of an outdated Jackson-Vanik amendment still hindering bilateral trade after more than a decade since the demise of the Soviet Union that it was intended to penalize.

Kazakhstan's Senate ratifies agreement with U.S. on destruction of missile silos

The Senate, the upper house of Kazakhstan's parliament, on Thursday May 16 ratified an agreement with the United States extending an earlier document on US assistance in destroying the remaining Soviet missile and nuclear infrastructure.

After the collapse of the Soviet Union, the United States agreed to provide funds to help Kazakhstan destroy missile silos and nuclear and other military infrastructure in a 1993 agreement with the Kazakhstan's government. The cooperation was conducted under the Cooperative Threat Reduction program sponsored by U.S. Senators Richard Lugar and Sam Nunn.

The United States has made USD 182 million available to Kazakhstan under the 1993 agreement. Since 1993 Kazakhstan removed 104 intercontinental ballistic missiles, destroyed 147 missile silos and sealed 181 nuclear test tunnel at the Semipalatinsk test site.

Kazakhstan has yet to destroy six intercontinental ballistic missile silos at its southern launch pad in Leninsk.

The current agreement will apply retroactively from December 2000 for another seven-year period until 2007, and it will provide for the allocation of additional funding from the U.S. to finish the work.

President Nazarbayev is expected to sign the ratification bill.

Preparations are under way for the first CICA summit

The 16 member-states of the Conference on Interaction and Confidence-Building Measures in Asia (CICA) are stepping up preparations for the first-ever summit of the forum which is to take place in Almaty on June 4. The summit was originally planned for November 2001 but was postponed in the aftermath of September 11th.

During the recent weeks, Chairman Jiang Zemin of China and Prime Minister Atal Bihari Vajpayee of India confirmed their attendance at the summit, along with leaders of Kazakhstan, Kyrgyzstan, Egypt, Iran, Tajikistan, Turkey, and Pakistan. Russian President Vladimir Putin has also preliminarily agreed to attend. Confirmations of attendance at the conference are expected from other members of the organization: Afghanistan, Azerbaijan, Israel, Mongolia, Palestine (Authority), and Uzbekistan.

At the summit the Asian nations are planning to sign the Almaty Act, which will set forth the principles of peaceful coexistence on the continent. Experts from the member-states are also currently preparing a draft of the declaration on the fight against terrorism to be signed at the summit.

ECONOMY

Kazakhstan, Russia sign agreement to divide Northern Caspian

Kazakhstan and Russia signed an agreement May 13 on dividing the northern part of the resource-rich Caspian Sea, an accord both nations said was a big step toward defining ownership rights to the sea's plentiful oil and gas fields.

President Nursultan Nazarbayev and President Vladimir Putin signed the new agreement, which builds on a July 1998 deal, during a meeting of the Eurasian Economic Community. It sets out specific geographical coordinates for dividing the northern part of the sea according to the principle of a median line. It stipulates that Astana and Moscow will divide the Kurmangazy, Tsentralnaya and Khvalynskoye fields, lying in the border area, on an equal basis.

The agreement "is a real breakthrough in bilateral cooperation in the development of the Caspian Sea," President Putin said.

President Nazarbayev said the signed document clearly defines principles and legal framework for the cooperation between Astana and Moscow, as well as with foreign companies, in exploring the seabed resources in the northern part of the sea.

The President of Kazakhstan stated Monday that the document confirms "correctness and viability of our approaches to resolving the problems of the Caspian, meaning clear-cut separation of rights for mineral resources usage and joint work for efficient usage of water and biological resources of the Caspian."

Kazakhstan is widely believed to hold approximately 75 percent of the sea's hydrocarbon reserves. Last year the international consortium, that includes U.S.-based ExxonMobil and Phillips Petroleum, announced the discovery at Kashagan oil field in the Kazakhstan's sector of the sea amounting to the largest oil find in the world in thirty years.

Experts believe the Kazakh-Russian deal will further reduce chances of instability or conflict in the Caspian Sea. As President Nazarbayev put it, he hoped the agreement would serve as an example for other Caspian Sea nations in reaching a "comprehensive five-party convention on the legal status of the sea."

President Nazarbayev also said, "the agreement should reassure all the investors in the region, both current and potential." Later this year Kazakhstan is to announce its new offshore development program that will include auctioning off dozens of new blocks in the northern Caspian.

In his other comments, he noted that he expected an agreement to be reached next month on the transportation of Kazakh oil through Russia. He said the agreement would likely span five to ten years and involve annual transportation of 16 million tons of oil.

U.S. envoy welcomes Kazakhstan-Russia Caspian agreement

The United States hailed the signing of an agreement between Kazakhstan and Russia to divide up three disputed oil fields in the northern Caspian Sea, U.S. special envoy to the Caspian region Steven Mann said in the Azeri capital of Baku on May 17. Washington supports any initiatives by the Caspian littoral states aimed at peaceful resolution of the Caspian delimitation issue, Interfax reported.

"I think that this is the type of issue that people of good will can find a solution for," Mr.Mann told reporters.

Industrial output grows in first four months of 2002

The value of Kazakhstan's industrial production rose 11.3% in January-April of this year vis-a-vis output in the first four months of 2001, the National Statistics Agency said on May 15.

The republic's industrial output in the first four months of 2002 was worth KZT 637.1 billion (USD 4.2 billion), the agency said.

... as unemployment shrinks in April

The number of unemployed people in Kazakhstan fell by 1.7% in April, with 683,800 or 9% of the workforce without work, the National Statistics Agency announced on May 15. Unemployment totaled 10.7% of the workforce in March.

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For more news and information visit us at www.kazakhstan-embassy-us.org

News Bulletin of the Embassy of the Republic of Kazakhstan

(Compiled from own sources and various agencies' reports)

Contact persons: Roman Vassilenko, Aibek Nurbalin

Tel.: (202) 232- 5488 ext. 104, 115

Fax: (202) 232- 5845