Kazakhstan – Opportunities and Challenges in International Trade

The geopolitical developments since the beginning of Russia’s war of aggression against Ukraine have brought Kazakhstan into focus as a sales market and a logistics hub for exports to the entire Central Asian region.

To tap the potential of this region profitably and safely for your company, a thorough understanding of the legal framework is essential. Sanctions regulations must not be violated under any circumstances! In addition, local knowledge, experience, and strong economic partnerships in the region are crucial to avoiding risks in areas affected by crises.

Prerequisites

Kazakhstan is undergoing a phase of geopolitical transition. The Russian invasion of Ukraine has posed major challenges for the country but has also created new economic opportunities. Traditionally closely connected to Russia, Kazakhstan also aims to strengthen its relations with Western partners.

Both geography and the shared history of the two countries play a key role: with a length of over 7,600 km, Kazakhstan and Russia share the world’s longest continuous land border. At the same time, political and economic ties exist due to their shared Soviet past and current membership in the Eurasian Economic Union (EAEU) together with Belarus, Armenia, and Kyrgyzstan.

While Kazakhstan continues to maintain relations with Russia, it is also taking measures to prevent the circumvention of sanctions.

Kazakhstan as a Hub for Trade and Logistics

From a European perspective, Kazakhstan has taken over Russia’s leadership role in several areas within the Eurasian Economic Union.

Whereas Russia used to serve as the natural gateway and hub for the EAEU, Kazakhstan has now assumed this position. For example, products destined for the entire Eurasian market can be certified there, and goods—of course in full compliance with EU sanctions!—can be distributed throughout the EAEU. Russia generally remains excluded for sanctions-related reasons, and companies must ensure and demonstrate that no circumvention of sanctions occurs via Kazakhstan.

Under these conditions, Kazakhstan offers itself as a spare parts, distribution, and service hub for the region.

Transport Routes to Kazakhstan: Which Route Is Best?

Although Kazakhstan is part of the ambitious “Middle Corridor,” several transport routes exist, each with its own advantages and disadvantages:

1. The Northern Route via Russia

This route was traditionally the most important link for European exporters. Due to current political developments, however, it now carries significant risks:

EU transit bans: Many goods may not be transported through Russia, which can lead to delays or complete delivery stops if even part of a shipment is potentially subject to sanctions. Such bans are not always easy to identify based on customs tariff codes, and shipments may be fully blocked—rightly or wrongly—on suspicion of sanctions violations.
Insurance difficulties: Transport across Russian territory is often not insurable or only at very high cost.
Legal uncertainties on the Russian side: Transit may violate Russian regulations, and resolving such issues can be extremely difficult.
With careful planning and detailed knowledge of sanctions regulations, however, this route can still be a viable and cost-effective option.

2. The Middle Corridor via the Caspian Sea

This route completely avoids Russia and is therefore unaffected by EU transit bans or potential arbitrary actions by Russian authorities. Nevertheless, it presents several challenges:

Longer distance: The route passes through Turkey, Georgia, and Azerbaijan.
Infrastructure capacity: Ferry connections are limited and weather-dependent—the Caspian Sea is notorious for severe storms.
Higher transport costs: The longer distance and limited capacity result in higher freight rates.
However, the countries along the route are investing heavily in infrastructure to make this corridor more attractive.

3. The Southern Route via Iran and Turkmenistan

This alternative has lost importance, as:

The political risk in Iran is currently considered very high.
Turkmenistan restricts transit through strict visa requirements, including for drivers.

4. Air Freight as a Fast Alternative

For time-critical shipments, especially goods that cannot be transported through Russia, air freight is an attractive option. Kazakhstan has several international airports with strong connections to Europe.

Kazakhstan as a Service and Distribution Center for Central Asia

In summary, Kazakhstan is not only an attractive market in its own right but also serves as a gateway to the entire Central Asian region. There is free movement of goods and services within the Eurasian Economic Union (EAEU), but not with other CIS countries such as Turkmenistan, Azerbaijan, Georgia, Tajikistan, or Uzbekistan.

Most importantly, EU sanctions must not be circumvented via Kazakhstan. Companies must ensure that no sanctioned goods are re-exported to Russia through Kazakhstan. The “Common High Priority Items” list identifies particularly sensitive goods subject to strict due diligence requirements. Exporting companies must therefore implement appropriate risk assessments and compliance strategies.

Our Expertise – Your Advantage

Our logistics expertise for Kazakhstan helps you identify optimal transport routes and minimize risks. With many years of experience in customs procedures within the EAEU, we offer tailor-made solutions for export and import.

  • Which route is best? We analyze the pros and cons of each transport option.
  • Customs and regulation? We handle not only the transport but also all formalities—from customs clearance to certification.
  • Sanctions compliance? We help you act safely and in full legal compliance.

 

For questions regarding your exports, please contact:
Pavel Kovalevsky
Head of Department
Tel: +43 662 88984-72
E-mail: p.kovalevsky@condor.co.at

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