How have Kazakhstan’s global imports and exports changed since the start of the Russia-Ukraine war?
- Timur Tsoy
- Dec 11, 2023
- 4 min read
Written by: Timur Tsoy
In the wake of the Russia-Ukraine conflict, the world has witnessed a seismic shift in geopolitical dynamics, significantly influenced by the disruption of supply chains and widespread sanctions imposed on Russia. These sanctions have not only reshaped Russia’s trade but also had ripple effects on the neighbouring countries, including Kazakhstan. This article delves into the nuanced shifts in Kazakhstan's global trade following the onset of the war. We begin by examining Kazakhstan's import and export statistics to lay the groundwork for understanding the broader implications of these geopolitical shifts on its trade relationships.
Imports and exports before the war:
In 2021, Kazakhstan's trade landscape showcased a significant leaning towards exports, with a total export value of 60,321 million USD, surpassing imports which stood at 41,415 million USD. This substantial trade surplus of approximately 18.906 billion USD places Kazakhstan in the 26th position globally [1] and highlights its strong position in global commodity markets, particularly in energy and mineral resources. [2]
The diagrams below vividly illustrate Kazakhstan's trade relationships, with China emerging as the top export destination, absorbing 16.20% of exports. This is closely followed by Italy and Russia, reflecting a diversified trade portfolio that spans both European and Asian markets. [3]
On the import side, imports from China form a significant portion, representing 19.87%, while other notable partners include Germany, the USA, and Turkey. However, Russia dominates as Kazakhstan's primary source of imports, accounting for a staggering 42.51% of total imports, which leads us to the conclusion that Kazakhstan's consumer market is closely tied to and reliant on Russia, particularly in energy needs and infrastructural dependencies.
As we dig deeper into Kazakhstan's trade dynamics, it becomes essential to turn our attention to the event that has reshaped the global economic landscape: the Russia-Ukraine war. For Kazakhstan, a nation intricately tied to both Russia and Ukraine, the repercussions have been profound and multifaceted. The next segment of our analysis aims to unravel how this ongoing conflict has altered Kazakhstan’s trade ecosystem, examining the direct impacts on its export and import channels, the inevitable shift in trade partnerships, and the broader economic implications that have emerged in this new, tumultuous era of global commerce.
In 2022, Kazakhstan’s total exports were valued at approximately $76 billion, a 26% increase compared to $60.321 billion in 2021. This rise was mainly due to increased commodity prices. Specifically, exports to Russia grew by 16%, and exports to China increased by 43%. Moreover, the export value surpassed the imports once again, which stood at $49.59 billion. With exports totaling approximately $76 billion and imports at $49.59 billion, Kazakhstan demonstrates a significant trade surplus of 26.41 billion USD, which is 39.7% greater than that of 2021.
There are many potential reasons for this happening, let’s analyze some of them.
Firstly, let’s take a look at Kazakhstan’s exports to Russia, as it would be logical for it to increase due to heavy sanctions on Russia, as was mentioned previously. Indeed, in 2022, Kazakhstan's exports to Russia experienced a substantial increase.
Here is a bar chart comparing Kazakhstan's exports to Russia in 2021 and 2022. The chart shows an increase in export values from 2021 to 2022. In 2021, the exports to Russia were approximately $7.04 billion; in 2022, this figure rose to $8.78 billion. This may suggest the reasoning behind Kazakhstan’s sudden export increase, but the figure is insignificant as exports to Russia in 2022 have increased by just 24.7%.
Secondly, let’s look at Kazakhstan's oil exports, as they took up almost half of Kazakhstan’s exports in 2021.
The chart illustrates a substantial increase in the value of oil exports from 2021 to 2022. In 2021, the oil exports were valued at approximately $31.0 billion, and in 2022, this value significantly rose to $46.8 billion.
This increase reflects the impact of the surge in global oil prices on Kazakhstan's export revenues, despite a slight decrease in the volume of oil exported. The global oil market experienced significant price hikes in 2022, largely driven by increased demand due to supply concerns exacerbated by geopolitical tensions of the Russia-Ukraine conflict. On the final trading day of 2022, the spot price of Brent crude oil closed at $85 per barrel, which was $7 higher than the price on January 3, 2022, when it was $78 per barrel [4] In summary, the combination of rising global oil prices, geopolitical tensions affecting global supply chains, and increased global demand for oil were key drivers behind the significant increase in the value of Kazakhstan's oil exports in 2022.
Conclusion:
In conclusion, there is no denying that Kazakhstan's international imports and exports have been significantly impacted by the Russia-Ukraine war. As we've seen, the dynamics of trade in the nation underwent substantial changes in the aftermath of the battle. Several factors, including heightened demand for its main commodities, strategic partner diversification, and advantageous global market circumstances, contributed to Kazakhstan's export boom in 2022.
But it's important to recognize that Kazakhstan, like many other countries, continues to face uncertainties and difficulties in an ever-changing geopolitical and economic landscape. Kazakhstan's trade fortunes are vulnerable to turbulence and unexpected consequences as the Russia-Ukraine war persists and global dynamics shift.
Essentially, the experience Kazakhstan had with trade after the conflict shows how resilient and adaptable countries can be when faced with geopolitical uncertainty. It emphasizes the significance of making strategic decisions, the need for trade policy to be flexible, and the pursuit of sustainable economic growth in a volatile environment. Kazakhstan's capacity to take advantage of its trade potential will be crucial in determining its economic development and level of regional influence in the years to come.
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