Customs relief among OTS countries to incentivize trade through Middle Corridor
Ulviyya Shahin
Read moreThe member states of the Organization of Turkic States (OTS) completed the ratification of the agreement on the creation of a simplified customs corridor, which provides for the integration of the information systems of Turkiye, Azerbaijan, Kazakhstan, Kyrgyzstan, and Uzbekistan.
The agreement on the simplified customs corridor envisages the simplification of foreign trade activities along the Trans-Caspian International Transport Corridor (Middle Corridor).
Today, the main share in the foreign trade of not only Kazakhstan but also Kyrgyzstan and Uzbekistan passes through two main corridors: from Russia to Europe and through China. The new agreement is aimed at the development of the third corridor - the Trans-Caspian corridor passing through the Caspian Sea, Azerbaijan, and Turkey. From 2010 to 2022, the trade turnover between the countries participating in this agreement increased three times. This indicates great potential for future growth.
Today, the volume of trade for Kazakhstan with these Turkic states is approximately 13 billion US dollars, and 70 % of this amount is accounted for by Kazakhstan's exports to these countries.
The simplified customs corridor has the following advantages: trade operators will receive priority service at the exit points, which will reduce waiting times; customs clearance procedures will be optimized using separate traffic lanes, which will further reduce clearance times; customs inspection will be carried out only in cases where the risk of violation of customs legislation is determined, which will allow to reduce the downtime and costs.
The agreement on the simplified customs corridor does not limit either specific industries or the choice of goods for customs clearance. This means that trade operators can use simplified procedures for all types of goods.
After the ratification of the agreement on the establishment of the simplified customs corridor, a six-month pilot project will be implemented. During this period, the customs structures of the five countries will fully work on all technical, administrative, and legal aspects of the new system. After the pilot project is completed, the system will be fully operational.
It should be noted that Azerbaijan, Turkey, Uzbekistan, and Kyrgyzstan ratified this agreement in 2023. Of the five OTS countries, only Kazakhstan remained, which this week confirmed to join the simplified customs corridor.
It should be noted that the agreement was signed on November 11, 2022, in Samarkand between the governments of Azerbaijan, Kazakhstan, Kyrgyzstan, Turkiye, and Uzbekistan.
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