the U.S. Agribusiness
Trade and Investment Mission
to the Republic of Kazakhstan,
Astana and Almaty, Kazakhstan, July 24–28, 2006)
Secretary Penn: Good morning, ladies
and gentlemen. I'm really glad to be with you
this morning. My name is J.B. Penn. I'm the
Under Secretary for Farm and Foreign
Agricultural Services at the United States
Department of Agriculture in Washington. It is
my extreme pleasure to be able to open today's
Trade and Investment Mission.
To all of our hosts I want to say thank you
for the very warm welcome that you have extended
to the U.S. Agribusiness Trade and Investment
Mission, and to all of the American businesses I
want to say thank you for traveling with us on
this mission to visit Kazakhstan. We are indeed
looking forward to a very productive time in the
I want to first acknowledge the very
distinguished guests we have at the podium.
Minister Yesimov, Secretary Johanns, Ambassador
Saudabayev, and Ambassador Ordway.
I am told that I should remind everyone to
switch off their cell phones, that everybody has
a habit of carrying two or three cell phones, so
instead of having everybody's phone going off,
if you would please just switch them off, and
we'll move ahead with the program.
This is indeed an auspicious occasion for us.
We are very pleased to be able to connect
American businesses with Kazakh businesses in
the field of food and agriculture. We think that
this is the beginning of what could be a very
fruitful relationship to the great advantage of
the business communities in both countries.
I want to note that Secretary Johanns and I
arrived just this morning, in fact an hour and a
half ago. We came from Geneva, Switzerland,
where we had been involved in the WTO Doha
Development Agenda negotiations, something that
is very much in the news today involving trade
and investment just as we are pursuing here
It is now my great honor to introduce our
host for this trip to Kazakhstan. I am very
pleased to introduce his Excellency, Minister of
Agriculture Yesimov. Mr. Yesimov was appointed
Minister in January of this year. He had
previously served as Minister from 2001, 2002.
He's been involved in Kazakhstan agriculture for
many years. So to kick off our program this
morning, please join me in giving a very warm
welcome to Minister Yesimov.
Minister Yesimov: Distinguished
Minister, distinguished Secretary, business
colleagues, representatives of the businesses,
ladies and gentlemen, please let me welcome the
high-level delegation from the United States of
America headed by Secretary Johanns on the soil
of Kazakhstan and wish your guests a warm and
useful stay here in Kazakhstan.
The whole world is aware of the economic
power of the United States, of your
technological and technical achievements,
including agriculture. Your agro-industrial
complex as of now is one of the most highly
organized, technologically developed, with a
huge export potential, so our collaboration with
you is a great honor for us.
Since many of you have come here for the
first time, let me give you a country profile
and tell a little bit about the agricultural
We're ranked ninth in the world in terms of
size. Our territory is over 2.7 million square
kilometers. In terms of natural resources
reserves, we're ranked among the richest
countries of the world naturally. We have good
grounds for that. We have impressive reserves of
coal, oil, ferrous, non-ferrous metals, rare
earthen metals. Along with mineral resources,
there are a lot of opportunities for wide-scale
development of renewable national resources. We
have vast expanses of land; availability of all
kinds of climatic zones makes Kazakhstan a
unique country to promote tourism, hunting,
fishing, as well as the agro-industrial
Speaking of the status of the development of
the agro-industrial complex of the country, it
can be characterized as a sector that is
developing in a stable manner, which provides
for the full security of the country and meets
all the demands of the internal market in terms
of food and raw materials.
The proportion of agriculture in the GDP of
the country is about 6 percent. The annual
growth rates of agricultural production are 6 to
7 percent. The sector has a great deal of
potential to further increase its production.
There is availability of huge markets, which
keep growing; total farmland area is 93 million
hectares with more than 23 million considered to
be arable land. We would like to note that we
have a lot of arable land that can help us
increase the farmland 1.2-fold.
The climatic conditions of the north and
northeast and a major part of the western and
central parts of the country are favorable to
growing grains, including wheat. It will grow
hard and strong types of wheat with good
characteristics that has high demand in global
markets. The consumers of our wheat are
countries from Asia, Africa, and Europe.
Annually, we produce about 15 to 16 million tons
of grain, of which four or five million are
exported. We are among the top seven or eight
exporters of grain. In terms of exports of flour
we rank 30th in the world.
At the same time, the extant land, labor, and
material resources make it possible to double
grain production in the near future and triple
the export volume. This is an area that is the
most promising in terms of investments.
According to the most modest calculations, the
volume of the neighboring markets is estimated
at 15 million tons annually. The eastern part of
the country is good for oil, plants, corn,
fruits and vegetables. In the south we
traditionally grow cotton and rice. All the
cotton as well as the bulk of rice is exported.
Another attractive area is cattle breeding,
the so-called pasture cattle breeding. Thanks to
natural pastures, we can produce competitive and
environmentally friendly products. We have 5.5
million head count of cattle, more than 14
million sheep, more than 26 million poultry. In
terms of per capita indicators, we're among the
leading countries of the world. We can double
the head count of cattle. As for the volume of
the market, it is considerable within the
country, and we have good prospects as compared
to neighboring countries.
Another important area is fisheries. Our
water reservoirs are raising such types of fish
as sturgeon, [sevroga], et cetera. We produce a
lot of Caspian black oil in order to attract
investments to this sector as well as to improve
the reproduction of fisheries; we intend to
organize fish hatcheries and provide them with
water reservoirs operational licenses for 10 to
15 years. This sector has a lot of prospects for
business development. We have unlimited
opportunities in the areas of development of
ponds and the development of artificial and
Another promising area is the processing of
agricultural products. Currently, this area is
free and a vacant niche for business
As you know, the success of any business,
including foreign business, depends on the
political stability of the country, on the
predictability of the actions of the state,
sound regulatory framework, and support to
entrepreneurial initiative. In that sense, a lot
has been done in Kazakhstan, and all the
government's policy in the area of support of
FTIs is geared towards this objective. Foreign
investors active in various sectors of the
country can see it with their own eyes, and our
country, among the [safest] countries in Eastern
Europe, is a very attractive country. In terms
of FTIs, we're in the top group of countries.
The regulatory framework of the agrarian sector
meets the requirements of the market economy,
international practices, and is geared towards
protecting and supporting the entrepreneurial
initiative of the manufacturers.
On the land code, farmland is used on a long
term lease basis, or foreigners have the
so-called temporary land use right. They can
lease it for up to 10 years. Upon the expiration
of the initial timeframe, this tenure can be
extended. Under the water and forest code as
well as the law on the reproduction of the use
of the animals, the water reservoirs, forest
areas, and hunting areas are provided to users
on a competitive basis for long-term use.
Private forest [farm] can also be organized.
This provides the stability for agro-business
as well as confident operation for agricultural
producers. The state provides support to the
ago-industrial complex. Naturally, we rely on
our potential. We cannot compare ourselves with
your country or with other Western countries. At
any rate, we have a holistic system of
centralized government. Support is geared
towards supporting entrepreneurial initiatives,
creating favorable conditions for accelerated
growth for priority areas of the agro-industrial
complex. To be more specific, speaking about the
government support measures, you'll get more
information from our director of the department
during the business forum.
Today, our country is working towards
acceding to WTO. We are engaged in negotiations.
The [inaudible] obligates us to take urgent
measures to increase the competitiveness of the
agrarian sector of the economy, so we need to
harmonize our activities with international
requirements to make our products compliant with
international standards. I think our cooperation
with you, the most advanced country in the
world, can be of great benefit.
I would also like to draw attention to the
fact that the agro-industrial complex of the
country has a lot of potential. I think that
through joint considered efforts with your
country, with your companies, I already told you
about our potential. We have a lot of potential
in animal husbandry, in cattle breeding. We have
a lot of land resources in order to produce more
crops, fruits and vegetables. I think through
considered efforts, we could increase our
production several fold and utilize the
neighboring markets, given the rapid growth
rates of the neighboring countries, and that
we'll be able to sell our products.
The President of the country set a very
ambitious goal, to be in the top 50 most
competitive countries of the world. The current
growth rates of our economy as well as the
existing potential testify to the fact that this
objective is quite realistic, and we are working
towards this goal.
In closing my remarks, I would like to
express the hope that your visit, Mr. Secretary,
that your meetings with the business community
of the country will serve as an additional
impetus to promote bilateral cooperation for the
benefit of our peoples.
Thank you for your attention.
Secretary Penn: Thank you, Mr.
Minister, for that very informative
I now have the distinct honor of introducing
U.S. Secretary of Agriculture Mike Johanns. It's
always with a great deal of trepidation that one
goes into introducing one's boss. You never want
to say the wrong thing.
I have had the distinct pleasure of working
with Secretary Johanns now for one and one-half
years, since he came to the Department of
Agriculture in January of 2005. During that
time, Secretary Johanns has been very
influential in the agricultural sector and in
agricultural policy. He has an agricultural
background and was the governor of one of our
most important agricultural states. Secretary
Johanns understands the agricultural sector, and
he's demonstrated his dedication to its
prosperity. He has shown determination to move
fundamental trade reform forward and has been a
dynamic force in shaping the future of world
As I indicated, we just came from Geneva,
where he has been very much involved in the
negotiations, including one 14-hour marathon
session, and I can tell you that over the past
two days he has had very little sleep.
This is Secretary Johanns's second visit to
Kazakhstan this year. In February, he led the
U.S. delegation at the inauguration of President
Nazarbayev to demonstrate the United States'
commitment to strengthen the long-term strategic
partnership and cooperation between our nations
and a shared vision of a prosperous and
sovereign Kazakhstan in the 21st
Secretary Johanns's presence here today
further illustrates his personal commitment to
developing commercial linkages and to more open
trade. History has clearly shown that open
economies and free markets can provide the
pathway to prosperity for all countries.
Ladies and gentlemen, please join me in
welcoming Secretary of Agriculture Mike Johanns.
Secretary Johanns: Thank you, JB. That
was very very good.
It is great to be back in Kazakhstan, and
good morning to everyone that is here.
JB in his introduction mentioned President
Nazarbayev. I was here for his inaugural just a
few months ago, and I had an opportunity to sit
down with him. I have to tell you, he is a very
very persuasive individual. When we sat down
together, he said, Mr. Secretary, I would love
it if you would put together a trade mission to
our country. I said, Mr. President, we will do
that. So I am here today to fulfill a promise
that I made to the President. I'm very very
honored and happy to do that.
I'm also very pleased to be back in the new
capital of Astana on the U.S. Agribusiness Trade
and Investment Mission. I do want to thank the
Agriculture Minister, Minister Yesimov. I
thought your comments were excellent. In fact, I
thought they were so good I think they deserve a
second round of applause.
I also want to acknowledge my friend, the
Ambassador from Kazakhstan to the United States,
Ambassador Saudabayev. It is good to see you.
When I was here in February, it was quite cold,
it was winter here, so the Ambassador promised
me that if I came back to Kazakhstan, he would
take care of the weather and deliver a very
beautiful sun-shiny day. Mr. Ambassador, you've
done an excellent job.
Let me also knowledge our Ambassador from the
United States to Kazakhstan, Ambassador Ordway.
We had an opportunity to meet when I was here,
and the Ambassador does such a great job for us,
and we appreciate his work.
Let me also acknowledge our Agriculture
Consul Jim Higginston, our USDA staff from
Turkey and Russia, and the U.S. Embassy staff in
Kazakhstan. In a mission of this size, a lot of
planning and work goes into it. It would be
literally impossible for me to name every person
that's been involved because it would be a very
long list, but I want the word to spread from my
comments today that I sincerely appreciate their
great efforts, and they have paid off. This is
going to be an outstanding mission.
This new capital city, ladies and gentlemen,
has a lot in common with its country. You are
building a new future for the Kazakhstani people
literally brick by brick. These building blocks,
however, are economic in nature. They feature a
market economy, they feature effective fiscal
and monetary policy, they feature accession to
the World Trade Organization, universal tax
laws, and a very strong banking system. For each
of those items we congratulate Kazakhstan.
Kazakhstan has a great amount to be very very
proud of. You have a bumper crop of "firsts" for
countries in Central Asia. You have the largest
economy in Central Asia with double-digit growth
in 2000, 2001 and over 9 percent annual growth
from 2002 to 2005. By anybody's definition, very
But the firsts don't stop there. You're the
largest grain producer and exporter in Central
Asia. You have the best banking system in the
region. You have the largest amount of foreign
direct investment of any country in Central
I'm here to tell you today that the United
States admires this nation's accomplishments. We
are proud to have Kazakhstan as a friend.
Kazakhstan has made significant progress in
economic reforms in the past 15 years of
independence. In 15 short years, Kazakhstan has
come a long way.
You have moved from a centrally planned
economy to a more transparent, a less regulated,
a more market driven business environment. An
environment that literally says our door is open
for business. You have successfully implemented
a number of structural reforms, which include a
pension system, public sector resource
management, energy, comprehensive taxation
system, and banking. I would also add that your
oil profits have been managed prudently with
part of the revenue saved in a national fund.
And you have a policy to diversify your economy.
That's why we're here, to
try to help [move] way from the over-dependence
on the oil sector by developing light industry
and service and agricultural sectors. We
believe we can be a good partner in this effort.
Kazakhstan also is working to improve its
legal and its regulatory frameworks and
standards with a view toward joining the World
Trade Organization in the near future. Let me be
very clear about this point. We, the United
States, strongly support your WTO membership and
feel this will bring significant benefit to
Kazakhstan's farmers and agricultural industry.
All WTO members, including the United States,
have had to make reforms to their agricultural
sectors in order to comply with WTO rules. It's
part of the world trade regimen. We are
encouraged that Kazakhstan has requested
technical assistance from the WTO Secretariat to
help make these reforms. We regard this as a
positive step in the adoption of WTO agreements,
including the sanitary and the phyto-sanitary
I'm also here today to tell you that the
United States has tremendous confidence in
Kazakhstan's future. With its abundant resources
and even greater supply of human capital,
Kazakhstan is becoming a successful,
independent, sovereign, and a prosperous nation.
With such credentials we look to Kazakhstan as a
leader in the Central Asian region. That bears
repeating. With such credentials we look at
Kazakhstan as a leader in the Central Asian
region. Your country can promote regional
integration processes that will no doubt benefit
your neighbors. Kazakhstan has a vital role to
play in ensuring prosperity across Central Asia.
The keys to progress are literally in your
hands, with continuing democratic and economic
reforms, the rule of law, anti-corruption
measures, accountability of institutions, and
very sound security policies. I think our
presence here today displays that American
companies stand ready to engage in serious
discussions to establish business partnerships.
We regard you as a strategic partner, and that's
why we are here today to strengthen our bonds
and create a better collaborative environment
for trade and investment between our two
Let me assure you that the members of our
delegation are first class in every way.
Trade and Investment Missions are different
from the normal trade missions that the USDA
sponsors. They are unique because they are
organized as two-way trade missions. This means
that while we have company representatives with
us who are certainly eager to sell their
products and services in Kazakhstan, we also
have representatives with us who are excited
about purchasing products from Kazakhstan and
the potential for investment here. So Trade and
Investment Missions provide an excellent
opportunity for two-way commerce.
We at the USDA understand something about
trade. We understand that trade is a two-way
street. That is why I'll be making a special
effort to understand the challenges and the
obstacles that Kazakhstani businesses face in
exporting their products into the United States.
I want to personally understand the difficulties
that agribusiness has in accessing our market.
You see, I believe very very strongly that we
cannot expect countries to provide greater
access to our products unless we are also
responsive to the challenges that others face
getting their products into our country, the
We look forward to working with Kazakhstan to
ensure that agreements and obligations under the
WTO can be met, to include the rules-based
approach to food safety required under the WTO
At USDA, we are increasing our emphasis on
trade capacity building activities. That's
really occurring on a worldwide basis,
especially in relation to our regulatory
requirements. This can make a difference in the
ability of other countries to export their new
products into the United States market. Our
Cochran Fellowship Program provides short-term
training in the United States to help countries
develop market driven food systems and increase
the trade links with U.S. agribusiness.
I'm very very pleased to note that since
1993, the program has sponsored 223 Kazakhstanis
for training in areas such as biotechnology,
agribusiness marketing, management, livestock
genetics, animal health, and veterinary
services. Seven additional fellows will likely
be sponsored this year. Since 1995, 16
agricultural university instructors from
Kazakhstan have been participating in the
Agricultural Economics Faculty Exchange Program.
This program, which we're very proud of, brings
university professors to the United States for
five months to help them strengthen their skills
in agricultural economics, marketing,
agribusiness management, and agrarian law.
Kazakhstan is a vital commercial market for
U.S. agricultural products, and we thank you for
that, and has benefited from U.S. export credit
guarantees since the 1990s. For fiscal year 06,
USDA has made available $200 million under the
GSM-102 program for this regional area, for this
The presence of the U.S. companies on this
mission reflects their confidence in Kazakhstan.
These representatives are here because their
companies are encouraged by the changes taking
place, by the leadership role that is being
provided by Kazakhstan in this region, and the
trade and the development opportunities that we
Several types of U.S. firms are
participating. We have a very very broad
mission. Farm equipment, agri-chemical
companies, animal genetics, meat, poultry, rice
exporters, irrigation, desalinization,
consulting and engineering, management, finance
companies and processed food supplies of fruits
and nuts and MREs. This range of business
community interests demonstrates the U.S.
sectors interested in Kazakhstan.
The United States is already the largest
foreign investor in Kazakhstan. At last count,
U.S. foreign investment in the Kazakhstan
economy totaled $12 billion. Over 100 U.S.
ventures and enterprises at work in Kazakhstan
have ratcheted up our partnership and our trade
So, ladies and gentlemen, in closing, I am
looking forward to seeing more of your beautiful
country than I had an opportunity to see during
my last visit and meeting with Kazakhstani
business representatives and governmental
officials. I know with my friend the Ambassador
in charge of the weather, it's going to be a
perfect week. Thank you.
Secretary Penn: Thank you, Secretary
Next I would like to introduce Ambassador
Saudabayev, the Kazakhstan Ambassador to the
United States. Ambassador Saudabayev has a long
career in government and diplomacy, and he was
assigned to the United States in the year 2000.
He's a very dynamic individual and represents
his country very well in Washington.
Please join me in welcoming the Ambassador.
Ambassador Saudabayev: First of all, I
would like to welcome our American guests and
especially Secretary Mike Johanns. I have
special respect for this person. He is an actual
embodiment of what is called the American dream
in the world. This is a person born and raised
in a farming family, not the richest farming
family, and has made his own career and
determined his own fate. He was a very
successful governor of the largest agricultural
state in the United States of America, the state
of Iowa. President Bush in his second
presidential term offered him the most difficult
portfolio in his cabinet: this is the portfolio
of the Secretary of Agriculture. Unfortunately,
this area is not easy to work in both in the
United States and here in Kazakhstan, and this
is a special visit for us primarily because it
is taking place at the initiative of our
President, who Mr. Johanns met during the
presidential inauguration on January 7 this
I remember how we were meeting the American
delegation at 5:00 in the morning, headed by the
Secretary here at Astana Airport. I think it was
minus 37 degrees plus the typical Astana wind.
They came out of the airplane in a light coat
and someone said, oh my God, where did we
arrive? So it was back then that I promised that
we also have summer here, and we're going to
have good weather.
I am very thankful to the Secretary that in
literally several months he was able to fulfill
his promise to the President, and, as you have
noticed, assembled a very powerful and a very
representative, both in terms of quality and
also in terms of the regions represented by this
delegation, to assemble this mission of people
who want to work together with us.
This sector has another meaning for me
because this is the most socially vulnerable
sector. The people who are part of this sector,
let's put it this way, are not the most affluent
people in our country. I would like to say that
in the last couple of years, the dynamics of our
relationship with the United States have
increased significantly, and evidence of that is
that in the last several months, starting with
the beginning of the presidential campaign here
and ending now, we have had visits from Vice
President Dick Cheney, Secretary of State
Secretary Condoleezza Rice, Energy Secretary
Samuel Bodman, and Mr. Johanns is coming to
Kazakhstan for the second time this year. I
would also like to mention one other person who
is sitting here in this audience who represents
the White House, represents the department
responsible for Eurasia, including Kazakhstan, a
big friend of our country, David Merkel. I would
like for all of you to welcome him.
I can tell you that strategic partnership,
and this is not my words or Secretary Johanns's
words, our heads of state characterized our
relationship this way, President George Bush,
President Nazarbayev, they've defined our
relationship as a long-term strategic
partnership that is founded on several pillars,
for security, fighting terrorism,
non-proliferation, economic cooperation, energy,
and of course issues related to democracy and
building civil society.
Of course, today out of $12 billion in U.S.
investments that have been invested in
Kazakhstan's economy over the last several
years, the vast majority of that investment went
to the energy sector, to the oil and gas sectors
in accordance with the strategy of our
Presidents on diversification of our economy, as
Minister Yesimov has mentioned here. Part of the
goal is to be one of the top 50 most competitive
countries in the world, and so of course it
would be very significant if we have strong
investment in our agricultural sector as a
result of that. Many people that are part of
this mission represent the most vibrant and the
most important sector of the economy to us. Not
just in the economy but also in regular life I
see this when I visit here periodically and see
how our life is changing. The capital does not
define the quality or the conditions of life. As
they say in the United States, Washington is not
America; so Astana is not Kazakhstan.
Agriculture is called the salt of the land
sometimes and the people who are engaged in
agriculture are feeding us. The fact that in the
last several years this area received more
attention by our country's top officials and the
fact that the Ministry is headed by Akhmedzhan
Yesimov, we see the results of his management.
This instills a lot of hope that this sector
will dynamically move forward, and the fact that
our strategic partners, the Americans, have
taken part in this process is another reason for
this partnership to be successful.
I would like to wish the participants of
today's forum for your meeting today to have a
favorable continuation that will be manifested
in specific deeds, specific projects, to benefit
both us and the Americans. This would be another
contribution to the strengthening of our
long-term partnership strategy, which we hope
will receive another powerful impetus at the
forthcoming meeting between our Presidents,
Messrs. Bush and Nazarbayev. I think that
today's visit by the Secretary and the upcoming
meeting between him and the President of our
country is another preparatory stage before the
summit meeting between our heads of state. This
is what we do, this is what our jobs are. We
work in between the state visits. And together
with my colleague, Ambassador Ordway, we are
implementing the agreements that were made
between our two countries.
I'd like to wish you successful work and for
you to meet new people, make new contacts in
Kazakhstan, not just in this room but in the
field, at the farms, and also we're coming to
the United States as well. We have held five of
those conferences in the United States over
these years, but this is symbolic that this
conference is the first one that is done under
the auspices of the Agriculture Ministers of the
two countries. So let's hope that this meeting
is fruitful, and I'd like to wish you a lot of
Secretary Penn: Thank you, Mr.
I'd now like to introduce Ambassador Ordway.
Ambassador Ordway is one of the most senior
diplomats in the United States Foreign Service.
He has served in numerous positions since 1975.
He has very extensive knowledge of this region
of the world, and he was appointed Ambassador to
Kazakhstan in 2004. So please join me in
welcoming Ambassador Ordway.
Ambassador Ordway: Thank you very
much, and thanks for the acknowledgement of my
long diplomatic experience. But of course that's
not where one starts. Where I started was in a
small agricultural community in the United
States, the number one agricultural state, which
is California. My first paid employment was in
the agricultural sector.
Speaking of firsts, the United States was the
very first country to recognize independent
Kazakhstan, to establish diplomatic relations
with Kazakhstan on Christmas Day, 1991, almost
15 years ago. We were the very first country to
establish an embassy here in Kazakhstan. So it's
a great pleasure to welcome as part of that line
of relationships that we've been building over
the last 15 years you, Mr. Secretary, back again
for I think your second and a half visit to
Kazakhstan, and it's really wonderful that you
have brought such a great delegation of U.S.
agricultural and agro-industrial representatives
Kazakhstan is a long way from the United
States, and for many Americans, we don't know
much about Kazakhstan. But I think for those
Americans who have come here, they have had some
idea about it. Many of them have been working in
Kazakhstan for many years and are desiring to
improve their relationships. A few others are
new to the market and are taking a look for the
first time. And although Kazakhstan is far away,
I think the size of the countries, the outlook,
the scope, the hospitality, all those things are
quite similar, and they're things that make it
easy for Americans and Kazakhstanis to do
We do business, I'll get to the business
part, but we do business in a lot of other
areas, too, some of which have been mentioned.
We have been partners since the very beginning
in preventing proliferation of weapons of mass
destruction. We fight terrorism together. We're
working to build security and stability in the
Caspian region and in Central Asia. We're
working together to fight crime, to stop drug
trafficking. We have programs to help prevent
the rise of HIV/AIDS, to prevent the spread of
tuberculosis. We're working and have worked for
many years on Kazakhstan's remarkable program of
economic reform. We are deeply engaged in
microeconomic reform, improving the business
climate for small and medium enterprises. We
are, as Ambassador Saudabayev said, deeply
engaged in trying to help Kazakhstan fulfill its
vision and President Nazabayev's vision of a
democratic society with a vibrant civil society.
But most of you here today are interested in
business and in trade and investment. Kazakhstan
is a very attractive place for that.
Several speakers have mentioned the volume of
U.S. investment here, which his growing not only
in the oil and gas sector but in other sectors
of the economy as well. Our trade is also
growing. American exports have risen to $540
million in 2005, which was up 7 percent over the
previous year. It includes things obviously like
petroleum drilling and oil flow equipment but
also railway transportation technology,
agricultural machinery, and equipment.
In agriculture specifically, we believe that
Kazakhstan is a growing and important market for
U.S. exporters. Kazakhstan's utilized U.S.
export credit guarantees for more than 10 years,
benefiting U.S. exporters, Kazakhstani business
partners, and local consumers. As a result,
exports of agricultural products from the U.S.
to Kazakhstan have grown from $10 million in
1995 to $42 million during the first half of
2006 alone, and if this mission is half
successful those figures will only rise
dramatically for the rest of this year and for
next year as well.
I also might note that the purchase of
agricultural equipment from abroad has also
risen. In 2005, there were $340 million worth of
purchases compared to $134 million in 2003. Now
the United States has only got a 10 percent
market share, so I encourage the Americans who
are here to try to get out there and increase
that market share and try to compete well with
the other major players, Russia and Germany, who
are in this market.
But we see a continuation of this growth
trend. We see rising incomes in Kazakhstan,
continued growth in the economy, high market
prices for farm exports and continued economic
expansion, and this all creates room for highly
competitive, well motivated businesses.
Part of the success of Kazakhstan, a large
part of the success is not just due to the fact
that they happen to be sitting on one of the
world's larger pools of oil. It has to do with a
sincere long-term commitment to economic reform
and creating the fundamental aspects of a market
economy. That is also one of the reasons why
American companies have been so successful in
Kazakhstan over the last 15 years and why there
continues to be great interest among American
investors and businessmen to continue to do
business in Kazakhstan.
But I'm not here to paint a totally rosy
picture for you. I have to acknowledge, and
those American businessmen who come into the
market have to realize, that there are
significant challenges in doing business in
Kazakhstan. It can be quite challenging at times
dealing with sometimes changing laws and
regulations, capricious enforcement,
difficulties in tax, customs, and other areas.
But we see those problems as Americans in other
countries. We continue to work with our
companies here who are I think almost totally, I
can say without exception, have been quite
We are about to move our embassy from Almaty
to Astana, and we will be moving into our new
building in September. But we will retain a very
healthy presence in Almaty, which is the
business and commercial capital of Kazakhstan.
Our U.S. Commercial Service with a full-time
senior commercial officer will continue to be in
Almaty, and he is always available to assist
American businesses with any problems or issues
they have, helping you become acquainted with
the market and trying to do our best in order to
ensure that you can do your best in improving
your relationships, identifying investment
opportunities, and concluding trade deals.
Again, I'd like to thank Secretary Johanns
for coming such a long way, congratulate his
team for having done an outstanding job of
organizing this delegation and this visit here,
thank our hosts, you Mr. Minister, and thank
Ambassador Saudabayev, whose energy has gone
into helping bring this all about. I wish all of
you, both Kazakhstani and American businessmen,
great success over the next few days as you seek
to develop and improve your relationships. Thank
you very much.
Secretary Penn: Thank you, Ambassador
I want to now collectively thank all of the
speakers who have done an excellent job of
highlighting the strategic and economic
importance of a strong trade and investment
relationship between our two countries. They've
set quite a goal for us to strive for this week.
In the United States we've always believed
that the strength of our system, our economic
system, resides in the powerful synergy of the
entrepreneur and a free marketplace. I'm very
impressed with the resources and talent that our
American businesses bring to the table. They are
highly motivated, and they believe that jointly
we can meet any challenge, and they firmly
believe, as shown by their presence here today,
that we can contribute to the prosperity of
Kazakhstan and to the United States. They know
that, as Ambassador Ordway said, Kazakhstan has
made great strides over the past 15 years, and
they anticipate helping, look forward to helping
in the transition to a fully free market economy
that will make the next 15 years even more
I'm very pleased now to have the opportunity
to introduce to all of you our private industry
representatives who have worked with us to help
expand trade horizons and who look forward to
working with Kazakhstani officials and
When I recognize your company if we could get
the representatives to stand. I'm working here
with some unfamiliar names so if I mispronounce
your names please bear with me, but I want to
make sure that we give due recognition to all of
the people that have traveled such a long
distance and made such an effort to be with us
Let me start alphabetically with ABS Global,
Mr. Toder Arboff.
From Agribusiness Management Company, Mr.
Toder Arboff again. [Laughter].
Mr. Arboff: Should I –
Secretary Penn: Yes, please.
Mr. Arboff: [Inaudible] is an
international company for [inaudible]. We
[inaudible] 70 countries worldwide, selling
Secretary Penn: Amity Technology, Mr.
Mr. Riebov: We work with [inaudible]
United States and we are the largest exporter
[inaudible] former Soviet Union. [Inaudible].
[Inaudible] as well as [inaudible] the United
Secretary Penn: Do we have the
microphone? Could you come to the microphone,
Mr. Arboff and quickly -- Oh, they're going to
bring the microphone to you.
Mr. Arboff: I am representing ABS
Global. That's the largest [inaudible] company
worldwide. We do business in 70 countries and so
annually $11 million [inaudible]. The company is
based out of Madison, Wisconsin.
Secretary Penn: Thank you.
Now still in alphabetical order. Agribusiness
Management Company, Nicklaus Previs.
Mr. Previs: Nick Previs from
Agribusiness Management Company. Forgive my
casual appearance. My luggage stayed in
Frankfurt. With me is Mike Young and Yerlan
Agribusiness Management Company is an
investment manager for a $100 million private
equity fund engaged in the agribusiness sector
in the former Soviet Union. We were previously
an equity partner with Mr. Sagadiyev in the
largest dairy company in Central Asia,
Foodmaster. We still own the largest ice cream
producer in Central Asia, which is Foodmaster
Ice Cream Company. We are also engaged in real
estate development activities right now with our
partner, Mr. Sagadiyev.
The other part of our business is Kantera
Partners, which is engaged primarily in
monetization activities with USDA, monetizing
agribusiness commodities throughout the world
for aid programs.
Secretary Penn: Thank you.
Mr. Riebov again, please. Thank you.
Mr. Riebov: I represent Amity
Technology. We are the leader of sugar beet
harvesting equipment both in the United States
and also in the countries of the former Soviet
Union. We are number one in sales to Russia of
sugar beet harvesters. We also manufacture
toolage equipment that is necessary for sugar
beets and equipment for soil analysis, including
soil samplers and soil labs. We are based in
Fargo, North Dakota in the well known
[inaudible] Valley, which is the largest
supplier of sugar beets in the United States.
Thank you for the opportunity to be here.
Secretary Penn: Thank you.
Now to Case New Holland, CNH. There are three
representatives. Mr. Arthur Miles who is the
business director; a friend of mine, Mr. Joe
Samora; and Steven Natterly. Mr. Miles?
Mr. Miles: Good morning. We are one of
the largest manufacturers of farming equipment
and industrial [inaudible] equipment. As you
said, I am the business director responsible for
the CIS and Central Asia, and I'm here together
with Joseph Samora, who is the Government
Affairs Senior Vice President based in
Washington, with Steve Natterly, also from
Government Affairs based in Washington; and the
representative of our distributor, Mr. Arsen
Idiebelkof from IPC Agri.
Later on in the day, we will give a
presentation about our activities and our
history in Kazakhstan. Thank you.
Secretary Penn: Very good, thank you.
Dow AgriSciences, Andrei Vernigor.
Mr. Vernigor: I represent Dow
AgriSciences. We are an agricultural unit of the
global leader of the petrochemical leader Dow
Industries. Our sales are about $3.5 billion
U.S. dollars. We have 5.5 thousand people. We
operate in the four main areas of the world --
North America, Latin America and Europe, as well
as Asia Pacific. We represent two areas of
development, namely agricultural chemicals and
special chemicals as well as plant genetics and
biotechnologies. Taking agrichemicals, we have a
broad range of means of protection against
[inaudible]. So we combat regular insects, we
have special plant protection chemicals, we also
provide protection for grains and insects, for
dry grain silos. We also provide biotechnologies
based on three platforms. One is seeds and
genes, genetic materials; second is manufacture
of oils, special types to improve the end
quality; and the third area is a new area,
namely animal vaccines produced from plant
Our idea of participation in this mission is
that despite the 10 years of our presence in
Kazakhstan, unfortunately some of our areas are
not yet developed in Kazakhstan, so we hope to
expand our trade relations in Kazakhstan in
these new areas.
Secretary Penn: Very good. Thank you
Food Pro International, Mr. Bill Washburn.
Mr. Washburn: It's always a pleasure
to be here. This is my second trip this year,
too. I would like to introduce our Vice
President of Technical Services, Vulgas Fulda. I
feel like we're in the right place at the right
time with respect to the food industry. Food Pro
International is a consulting engineering
service company. We provide technical transfer
in the area of food and beverage production and
distribution. We have projects we're already
working on here.
We've been in business for 30 years. We have
our headquarters in San Jose, California and our
design section is in Stockton, California. We've
completed more than 400 projects in 43 countries
and we are looking forward to the rest of this
visit. I understand we're going to have a little
more time later today to tell about our company,
so we're glad to be here once again.
Secretary Penn: Thank you very much.
As Mr. Washburn said, there will be more time
later to explain about your company, so this is
the time for just a very brief introduction to
help us stay on schedule.
Food Source Incorporated, Sayed Hussein.
Mr. Hussein: Thank you. I am Sayed
Hussein with Food Source. We are a major
supplier of nuts and dried fruits. Our major
markets are the Far East, the Middle East, and
Eastern Europe. Russia is our biggest market.
Later on maybe I can tell more about the
company. Thank you.
Secretary Penn: Thank you.
Globex International, Mr. Leonid Kogan.
Mr. Kogan: My name is Leonid Kogan. I
am President of Globex International out of New
York City, United States. We supply Kazakhstan
with poultry and meat for the past 13 years. The
introduction will be later, probably.
Secretary Penn: Yes, you'll have more
time later, so this is the time for just a brief
Intervision Foods, Mr. Jim Wait. Not here?
John Deere, Mr. Ivan Vovschalk.
Mr. Folkt: I am not Ivan Vovschalk, I
am Yoven Folkt, and by moving on like this we
avoid that you have to pronounce my name.
[Laughter]. We are representing John Deer
International, which is the company's export
branch responsible for some 100 countries. When
you see "in country" behind my name, it means
Switzerland. We are located in Switzerland, and
I have with me Ivan Vovschalk who is the sales
manager for several CIS countries, and we have
also with us from our distributor Eurasia, Mr.
Sahin and some of his staff. Thank you very
Secretary Penn: Thank you.
Mitamar Corporation, Mr. Bill Osey.
Mr. Osey: Thank you. First I wish to
thank all of you here because it is your
presence that will make this trip our success,
so I thank all of the attendees for this and
thank the Secretary and the Ambassadors for
Our company, Mitamar Corporation, is based in
Cedar Rapids, Iowa. Our state is three million.
If we had 20 million like California we would be
even a bigger exporter and producer of
Our company exports to about 35 countries. We
have been in business since 1975. We are the
leading producer of Halal products in North
America. We export to Korea, Japan, China,
Malaysia, Singapore, Indonesia, North Africa,
Morocco, Tunisia, Egypt, and all of the Gulf
area. We'll explain more about our services. We
provided Halal services to McDonalds, Burger
King, Applebees, and International Concepts in
addition to equipment. So we thank you and look
forward to meeting all of you later.
Secretary Penn: Very good. Thank you.
National Meat Association, Jeremy Russell.
Mr. Russell: I'm Jeremy Russell. I'm
representing the National Meat Association,
which represents about 500 packers and
processors in the United States, including
Globex as well as other associated service
providers. I also sit on the Board of Directors
of the U.S. Meat Export Federation, so I'm here
representing them as well. Thank you.
Secretary Penn: Thank you.
Sweetwater International, Mr. Edward Jackson.
Mr. Jackson: Hi. We treat poor quality
groundwater, adjust the pH to make it beneficial
for crops. Carry on.
Secretary Penn: Thank you very much.
Just as your name implies, Sweetwater.
U.S. Rice Producers Association, Mr. Greg
Mr. Yielding: Salim. My name is Greg
Yielding. I'm the field director for the U.S.
Rice Producers Association. We wish to have a
Kazakh-U.S. rice producer partnership to supply
rice to Kazakhstan mills when they run out of
their own rice for processing. We also have
information on value-added products that they
might produce. I'm glad to be here. This is my
second trip, and it's a wonderful country. Thank
Secretary Penn: Thank you.
The U.S.-Kazakhstan Business Association, Mr.
Mr. Viehl: Good morning. I'm Bill
Viehl. I'm based in Washington. I run this
association, have been doing so for the past
seven years since it was created. We have about
20 large American multinational companies, two
of them are represented here today—Case New
Holland and Deere. But that's a picture of the
past. I think this conference is a picture of
the future with lots of medium sized businesses,
and we're hoping to see those types of
organizations become members of our association.
Our association basically promotes investment
and trade in Kazakhstan. Thank you.
Secretary Penn: Thank you.
And now from Secretary Johanns's home state,
Nebraska, Valmonte Irrigation, Incorporated,
Mr. Berkland: I'm Richard Berkland
from Valmonte Irrigation. We're headquartered in
Omaha, Nebraska. We're the world's largest
provider of mechanized irrigation. We have
factories in 34 countries, and we supply exports
to over 100 countries.
Secretary Penn: Very good, thank you.
Worldwide Sires, Ltd., Tony Evangelo.
Mr. Evangelo: Thank you. My name is
Tony Evangelo. I am the area director of
marketing for Worldwide Sires in Eastern Europe
and parts of Asia as well. You'll have to excuse
my semi-casual appearance. My luggage didn't
make it either. [Laughter].
Worldwide Sires has been exporting cattle
genetics around the world for nearly 35 years,
and last year we had experience exporting to
over 70 countries worldwide. We are based out of
Iselia, California, and we represent and are
owned by two of the largest AI cooperatives in
the U.S., Accelerated Genetics and Select Sires,
which combined have a membership of over 70,000
I'd like to say thank you to the FAS and to
the Ministry of Agriculture for hosting us here,
and I'm looking forward to my visit to
Kazakhstan. Thank you.
Secretary Penn: Thank you.
I think that all of you would agree with what
Secretary Johanns said earlier, that we have a
very diverse participation in this mission. We
have some of the premier companies in the U.S.
representing a broad spectrum of all of the
Again, I want to thank you, the American
businesses – did I miss someone? I'm very sorry.
Voice: You missed me because I was an
add-on. I've been in Kazakhstan for a long time,
over a 13 year period, but I'm a dairy farmer,
and I am a volunteer through Windrock
International. I also represent Tara Service
that sells semen, a U.S. company that's been in
business in Kazakhstan for 10 years.
Secretary Penn: Windrock International
is an Arkansas Foundation. We have to mention
that state as well.
Again, you can see that we have a very
diverse group, a very broad group, and I want to
say personally we very much appreciate your
participation in this investment mission. Again,
we know of the time and expense involved, and I
think this certainly demonstrates your interest.
So let me close this session this morning and
say on behalf of USDA and on behalf of Secretary
Johanns, we're very much pleased to be here.
We're very much pleased to be in the role of
facilitating the interaction between the
American business community, the Kazakhstan
business community. We want to facilitate trade
and investment certainly in the food and
agricultural area. We look forward to working
with you and to seeing more of the country and
to being with you during the rest of the week.
Thank you very much and thanks again to our
speakers this morning.
# # # #
the U.S.-Kazakhstan Trade Mission Main Page
Promoting Agricultural Trade and Investment Main
the International Development Main Page