AMBASSADOR ORDWAY MEETS WITH DPM AND TRADE MINISTER

UNCLAS ALMATY 000304 SIPDIS DEPARTMENT FOR EUR/CACEN JMUDGE, EUR/ACE JMCKANE TREASURY FOR CENTRAL ASIA DESK OFFICER MGAERTNER COMMERCE FOR CENTRAL ASIA DESK OFFICER DSTARKS SENSITIVE E.O. 12958: N/A TAGS: ECON EFIN PGOV KZ ECONOMIC SUBJECT: AMBASSADOR ORDWAY MEETS WITH DPM AND TRADE MINISTER MYNBAYEV ¶1. (U) Summary/Background: Ambassador Ordway called on Deputy Prime Minister and Minister of Industry and Trade Sauat Mynbayev January 25 in Astana. They discussed Kazakhstan's WTO accession, the Minister's prospective attendance at the inaugural TIFA Council meeting and his possible trip to San Diego for the Kazakhstan Investment Conference. Also, Mynbayev argued for Kazakhstan's immediate graduation from Jackson-Vanik scrutiny. ¶2. (U) Sauat Mukhametbayevich Mynbayev, 42, was named Minister of Industry and Trade in addition to being a Deputy Prime Minister in December 2004 when Adilbek Dzhaksybekov was appointed Head of the Presidential Administration. Mynbayev had already been serving as a deputy PM since June ¶2003. He has served in a variety of senior government positions, among them Minister of Finance and Minister of Agriculture. His longest stint in the private sector was from 1992-1995, when he worked as first deputy chairman of Kazkommertsbank. End Summary/Background. ¶3. (SBU) Ambassador Ordway first raised the issue of Kazakhstan's WTO accession, noting positively the progress the GOK made in several key areas in 2004. Mynbayev did not discuss substantive issues affecting accession. He did, however, express concern that Kazakhstan's accession was being overshadowed by the concurrent accessions of Russia, Ukraine, Saudi Arabia and others. He expressed concern that Kazakhstan was not getting enough attention from the USG. ¶4. (SBU) Mynbayev also brought up the United States' continued application of Jackson-Vanik review to Kazakhstan. Mynbayev said he could not see any justification for it, and asked when the United States would stop the practice. The Ambassador told him that while he understood this concern, events in Russia are generally the main factor affecting Congress' view of the Jackson-Vanik issue. The Ambassador also pointed out that based on the experience of other former Soviet states, Kazakhstan will be more likely to graduate from Jackson-Vanik treatment once it joins the WTO. ¶5. (U) When the Ambassador inquired about Mynbayev's travel plans, the minister responded that there was a tentative plan that he would lead the government delegation to the Kazakhstan Investment Conference in San Diego March 11. However, according to Mynbayev, the government has not decided yet who will travel. The Ambassador also told Mynbayev that the USG would welcome his presence at the inaugural TIFA Council, but the minister did not appear to have considered it yet. ¶6. (U) The Ambassador also raised the cost-sharing arrangement proposed by USAID to fund its economic policy and SME development programs. Mynbayev responded that the government's budgetary commission, which will start its work on the 2006 budget in February, intends to appropriate funds for the purpose of cost-sharing; however, he did not offer any information on when the GOK might be ready to sign an agreement formalizing the arrangement. ¶7. (SBU) Comment: Mynbayev's comments on WTO accession were less sanguine than the GOK's public line and reflected a realization that Kazakhstan will be at a definite disadvantage should Russia join first. His remark that Kazakhstan needs more attention from the U.S. side echoes remarks made in December by WTO negotiator and Vice-Minister Zhanar Aitzhanova. End comment. ¶8. (U) Minimize for Dushanbe considered. Ordway NNNN