Kazakhstan Senate ratifies investment protection agreement with Estonia15 july 2014, 15:11
The Senate of Kazakhstan has ratified the agreement between Kazakhstan and Estonia on encouragement and mutual protection of investment activities on June 26, Tengrinews reports citing IA Novosti-Kazakhstan.
According to the Senate Committee for Foreign Affairs, Defense and Security, each party shall encourage and create favorable conditions for investors of the other party for investments on its territory in accordance with the national legislation. In order to encourage mutual investment flows, the parties shall inform each other about their investment opportunities.
Moreover, each side shall fully protect and safeguard investments and revenues of the other side.
In case of investment expropriation, the agreement provides for compensation in the amount equal to the fair market value of the expropriated investment that shall be paid without delay.
“If investments of investors of one side made at the territory of the other side are insured against non-commercial risks via a system established by the legislation of the latter, any subrogation of the insurer, which stems from the terms of the insurance contract, shall be recognized by the other party,” the Committee explained.
In addition, the agreement extends to investments made both before and after the agreement enters into force. It, however, does not apply to disputes, which arose as a result of the investments made before the set date.
The Minister of Economy and Budget Planning Yerbolat Dossaev said that the agreement provides clear rules for expropriation, nationalization, investor compensation and dispute resolution.
According to him, in the years between 2005 and 2013, the gross inflow of Estonian FDI to Kazakhstan amounted to $48.3 million and the gross outflow of FDI from Kazakhstan to Estonia in the same period amounted to $1.3 million.
He added that Kazakhstan’s exports to Estonia in 2013 were at $4.7 million. The main export was oil, waste and scrap ferrous metals, fish fillets and other fish. Imports from Estonia to Kazakhstan in 2013 totaled at $29.7 million. Electronic devices, drugs, panels, consoles, desks, cabinets, glass putty, resin cements, caulking compounds and other mastics constitute the main part of imports from Estonia to Kazakhstan.
By Dinara Urazova