Kazakhstan intends to increase the growth of mutual trade within the EAEU by $ 6 billion .

Nur-Sultan - July 2, 2021. Today, within the framework of the annual Astana Economic Forum, Vice-Minister of Trade and Integration of the Republic of Kazakhstan Zhanel Kushukova took part in the panel session of Astana Finance Days "Restoring Growth" on the topic "Institutionalization of Eurasian integration initiatives".

Zhanel Kushukova reported on the possibilities of increasing mutual and foreign trade of the EAEU countries, as well as on the prospects of creating a Eurasian Reinsurance company.

"We must admit that the EAEU has one of the lowest indicators of mutual trade among other similar international associations. According to the results of 2020, the share of mutual trade of the EAEU member states accounts for only 11% of the total trade of the EAEU member states. For example, in the EU, mutual trade accounts for 62.5%, in NAFTA – 49.3%, ASEAN (+6) - 45.4%.We have a significant potential to increase mutual trade, primarily by eliminating barriers on the domestic market, as well as by establishing cooperative ties between our countries, " Zh.Kushukova.

In terms of the development of foreign trade of the EAEU countries, the Vice Minister noted the intensification of work on the conclusion of preferential trade agreements with third countries.

The creation of new free trade zones on mutually acceptable terms should become a "locomotive" in promoting our products to world markets.

In this context, the Ministry of Trade and Integration of the Republic of Kazakhstan considers the creation of the Eurasian Reinsurance Company as an effective instrument of export support aimed at increasing mutual and foreign trade of the EAEU countries.

The issue of the feasibility of creating a Eurasian reinsurance company is planned at the level of heads of government in August this year. And if all parties support it, then a more detailed study of this issue and the preparation of an appropriate regulatory framework will begin.

"I believe that the Eurasian Reinsurance Company will allow combining the efforts of insurance and reinsurance organizations of the participating countries in the distribution of major risks, improve the reinsurance capacity for the prompt and effective implementation of export transactions, avoid the need to use brokerage services, which will lead to a decrease in the cost of reinsurance, and also affect the expansion of the possibilities of insurance of export transactions in an amount exceeding the maximum own retention of insurance companies", - the Vice-Minister of Trade and Integration of the Republic of Kazakhstan Kushukova Zh. S. concluded

Recall that within the framework of the EAEU, it is proposed to create a Supranational Reinsurance Company in the form of an international company within the EAEU with an authorized capital of $ 200 million on the basis of an intergovernmental agreement. The potential insurance capacity is up to $ 2 billion. The planned effect is the growth of mutual trade within the EAEU of more than 6 billion US dollars. The company's capital is proposed to be formed at the expense of property contributions from export credit agencies of the EAEU member states, direct contributions from member states, development banks of the EAEU member states, as well as the Eurasian Development Bank.

Recall that within the framework of the EAEU, it is proposed to create a Supranational reinsurance company in the form of an international company with an authorized capital of $ 200 million on the basis of an intergovernmental agreement.

At the initial stage (2-3 years), about $ 100 million will be required to launch the project.

The shares of participants in the capital can be set taking into account the share of each ECA, development banks of the EAEU member states, the EDB in the total volume of current insurance liabilities for risks in the EAEU countries: EDB – 32%, Russia (EXIAR) - 33%, Belarus (Beleximgarant) - 10%, Kazakhstan (KazakhExport) - 10%, Armenia (ESA of Armenia) - 10%, the Kyrgyz Republic (RSK Bank) - 5%. The final structure and mechanism of capital financing should be worked out jointly with all participants.

Exporters of the EAEU member states will be able to use the services of the reinsurance company.