Representatives of the grain and flour industries of Uzbekistan and Kazakhstan expressed concern at the Uzbekistan-Kazakhstan Business Forum in Tashkent. The main issues concerned the reduction of VAT refunds for Uzbek traders importing Kazakh grain, as well as the sale of counterfeit flour under Kazakh brands in Uzbekistan and Afghanistan.
Uzbekistan imports about 4 million tons of grain from Kazakhstan annually. One Uzbek entrepreneur working in this sector reported that his company and its partner import approximately one million tons each per year.
Since March of this year, grain exporters to Uzbekistan have faced a fivefold reduction in VAT refunds—from 100% to 20%. A ministry representative responsible for the financial portfolio on the Uzbek side confirmed that this issue was discussed with colleagues from Kazakhstan.
He noted that many entrepreneurs from Kazakhstan raised this problem. Discussions took place at the Ministry of Agriculture and with members of parliament, and were presented to Deputy Prime Minister Serik Zhumangarin. As a result, it was decided to revert to the mechanism that was in place last year before these changes were introduced.
According to the official, authorities are currently working on the legal wording of this mechanism, including the question of its retroactive application to the current year. The final decision will be made by parliament.
He added, 'A new parliament is currently being elected, and the final decision will be made there. Therefore, we need to wait a little longer. The government's position is generally to return to the previous mechanism, but the details have not yet been finalized.'
Kanat Sharlapayev, Chairman of the Presidium of the National Chamber of Entrepreneurs 'Atameken' of Kazakhstan, summarized the situation. He stated that the Ministry of Economy, tax authorities, and the Ministry of Agriculture officially agreed to restore the former mechanism. Now, a vote by parliament members is required, which is expected in September. In his experience, if three state bodies agree and the National Chamber supports it, the chances of approval are high.
From the Kazakh side, it is noted that the country ranks sixth or seventh globally in grain exports and second in flour exports. The production capacity for wheat processing in the country is estimated at about 11 million tons, of which 4–5 million tons are currently processed. Approximately 200–300 flour mills operate in Kazakhstan, producing up to 4 million tons of flour annually; half of this product goes to the domestic market, and the other half is exported.
Forum participants also raised the issue of counterfeit flour sold in Uzbekistan and Afghanistan under the brands of Kazakh producers. A industry representative emphasized that the ongoing problem with such products requires further work, including strengthening border control in Uzbekistan and Afghanistan.
The discussion concluded that flour is often repackaged in Uzbekistan under a Kazakh brand before being sent to Afghanistan. Afghan traders reportedly request Kazakh packaging due to its reputation in the market. Participants noted that the quality of the repackaged product may differ from the original, creating reputational risks for Kazakh producers among end consumers.
At the end of the discussion, the parties agreed to appoint responsible representatives for the flour production sector to continue working on issues of pricing, quotas, and brand protection.
Uzbekistan will continue to provide pension payments to citizens who decide to permanently move to Kyrgyzstan. This measure was enshrined in the agreement on state social insurance and pension provision, signed by the Government of Uzbekistan and the Cabinet of Ministers of Kyrgyzstan in Cholpon-Ata on July 30, according to the Pension Department of Uzbekistan.
Under the new agreement, moving from Uzbekistan to Kyrgyzstan will no longer be grounds for terminating an Uzbek pension. Alisher Rasulov, head of the Pension Department, noted that a citizen can open a bank account in Kyrgyzstan and provide its details to Uzbekistan, after which the pension will be transferred to that account.
The agreement also provides for pension provision for individuals who have worked in both countries. The parties agreed to apply the proportional principle, whereby each state will determine and pay the pension based on the work experience and earnings obtained on its territory. Thus, if a citizen has employment records in both Uzbekistan and Kyrgyzstan, each state will be responsible for payments for the corresponding period of work.
Additionally, the agreement ensures the mutual recognition of employment records. These new arrangements are also aimed at resolving issues related to the implementation of the 1992 international agreement on guarantees of pension rights for citizens of CIS member states. Specifically, the parties established a bilateral procedure for the mutual recognition of employment records.
The signing of this agreement took place during the state visit of the President of Uzbekistan Shavkat Mirziyoyev to Kyrgyzstan. At the invitation of Kyrgyz President Sadyr Japarov, Mirziyoyev was in the country from July 30 to August 1.
During the high-level meetings, the presidents discussed further strengthening relations of friendship, good neighborliness, and strategic partnership. Issues such as increasing bilateral trade, expanding industrial cooperation, developing transport connectivity, as well as cultural and humanitarian interaction were also on the agenda.
For the agreement to enter into force, the completion of relevant internal procedures and ratification of the document by both parties is required. According to Rasulov, Uzbekistan plans to conduct negotiations on similar agreements with other CIS countries and neighboring states, including Turkey, Azerbaijan, Tajikistan, Kazakhstan, and Turkmenistan.
