Azernews.Az

By Sara Rajabova

Russia's economic slump continues to negatively impact Astana-Moscow economic relations.

A sharp devaluation of the Russian ruble after sanctions on Moscow due to the Ukrainian crisis created great hardship for the Kazakh economy.

Recently, Russia and Kazakhstan have exchanged reciprocal trade bans, confirmed the Russian media. Russian newspaper "Kommersant" reported what it labeled a “trade war” between the two post-Soviet countries.

Local companies in Kazakhstan have had troubles when it comes to competing with cheap Russian goods in the local market.

Therefore, representatives of local businesses have called on the government in February to impose restrictions or bans on Russian import to Kazakhstan. They found it difficult to compete with Russian manufacturers whose products fell sharply due to the devaluation of the ruble at the end of 2014.

High margin in the exchange rates in Kazakhstan and Russia caused a substantial difference in prices of similar goods in the two post Soviet countries. Kazakh citizens prefer to buy cheap Russian goods, a trend which eventually created problems for local entrepreneurs.

In early March, Kazakhstan announced the introduction of a "conventional ban" for 45 days on the import of Russian oil (see. "Kommersant" on March 3).

Discussions about this “trade war” were fueled as the Kazakh Committee on Consumer Protection seized nearly 5 tons of Russian poultry products on March 31. Also, mayonnaise, butter and sunflower oil were set to be withdrawn from the Kazakh market, which is a large market for Russian producers.

Meanwhile, Russia has already begun to take retaliatory measures against Kazakh goods, according to the Kazakh media. Russian Federal Consumer Rights Protection and Human Health Control Service (Rospotrebnadzor) announced on April 10 that Kazakh products not complying with Russian requirements had been detected in some regions and withdrawn from the market.

However, Kazakh officials have dismissed the information saying no one had declared such a “trade war”.

Kairbek Uskenbaev, the Kazakh vice-minister of national economy said there is no trade war between Russia and Kazakhstan, it is only the unscrupulous suppliers, supplying low-quality products, RIA Novosti reported.

“This is not in regard to Russia, but to the some entrepreneurs who produce low-quality products. And to raise it to the rank of a state policy is absurd,” Uskenbaev said.

Meanwhile, a Russian official also denied allegations of a "trade war" existing in between Russia and Kazakhstan saying it is greatly exaggerated, RIA Novosti reported.

“I think it's a strong enough exaggeration. And though I do not have all details at hand I think that such language as a trade war, is not quite correct,” said Dmitry Peskov, press secretary of the Russian president.

--

Sara Rajabova is AzerNews’ staff journalist, follow her on Twitter: @SaraRajabova

Follow us on Twitter @AzerNewsAz