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| Screw Russia, "Buy Kazakh." |
We haven't had a trade-related post in quite some time now, so I have one for you right here. And what a story it is! In fact, it's my early candidate for 2015's dumb-but-true story in a year not exactly lacking for logically-challenged events. With apologies to
Phil Collins, ever heard of an
internally discriminatory free trade agreement? Neither have I--until now. It seems Kazakhstan has been heavily promoting a "
buy Kazakh" drive
immediately after a customs union with Russia
came into effect at the start of the year.
Shelves in supermarkets across
the ex-Soviet republic of Kazakhstan teem with bright signs championing
locally-produced goods over Russian alternatives.The push to
buy local is part of the government's "Made in Kazakhstan" initiative to
support domestic producers struggling to match cheap imports from
neighbouring Russia, which have enjoyed the competitive benefits of the
sanction-battered ruble's dramatic slide in value.
The
campaign was launched despite Kazakhstan and Russia having entered the
Eurasian Economic Union earlier this year -- the trade bloc backed by
both countries' authoritarian presidents. The blue "KZ" labels of the Buy Kazakh campaign appear to be achieving their objective with some patriotic shoppers...
Authorities in Astana have recently slapped bans on fuel and foods --
from chocolate to pork products -- imported from its strategic Russian
partner, citing alleged sanitary breaches [...] Following complaints by Kazakh
confectionery giant Rakhat that its sales have plummeted 20-30 percent
this year due to Russian competitors selling their products up to 60
percent cheaper, Astana moved to bolster the company's fortunes this
month by banning Russian chocolate.
Prohibitions
are also roiling fuel products after Kazakhstan suspended imports for
45 days on March 5, citing a domestic surplus. Last
week the Kazakh government renewed restrictions on Russian diesel
imports, with local refiners standing to benefit as farmers prepare for
the spring sowing season.
Not to be outdone in "liberalizing trade," the Russians have been blocking their Kazakh counterparts with trade barriers of their own as both sides deny that anything is amiss:
Moscow has responded with tit-for-tat measures as both government seek to protect affected businesses.
Officials in both countries deny
problems in bilateral relations, with Putin's spokesman Dmitry Peskov
recently calling talk of a trade war an "exaggeration". Kazakhstan's
Deputy Economy Minister Kairbek Uskenbaev said the bans concerned
"specific companies," and would not damage the country's "most friendly"
relations with Russia.
With "free trade agreement partners" like these, who needs protectionism?
