KAZAKHSTAN - WHEAT EXPORTS AN IMPORTANT ISSUE IN

C O N F I D E N T I A L SECTION 01 OF 02 ASTANA 001808 SIPDIS E.O. 12958: DECL: 09/17/2018 TAGS: PREL EAGR PTER KZ EG SUBJECT: KAZAKHSTAN - WHEAT EXPORTS AN IMPORTANT ISSUE IN RELATIONSHIP WITH EGYPT Classified By: Pol-Econ Chief Steven Fagin, Reasons 1.4 (b) and (d) -------------- Summary -------------- ¶1. (C) According to the Egyptian Embassy, Kazakhstani wheat exports to Egypt are an important issue in Kazakhstan-Egypt bilateral relations and were a main topic of discussion for the August 29 visit to Astana of Egyptian Trade and Industry Minister Rachid Mohamed Rachid. Egypt is interested in increasing pharmaceutical exports to Kazakhstan, but faces bureaucratic hurdles. Egypt expects to send Religious Endowments (Awqaf) Minister Zakzouk to the October 17 Common World Forum ministerial meeting. The Egyptians are only "passively" participating in Nazarbayev's Conference on Interaction and Confidence Building Measures in Asia (CICA). Several hundred Kazakhstanis are studying in Egypt; some have been deported back to Kazakhstan for alleged involvement with Wahabi groups. End Summary. -------------- -------------- Wheat: A Key Issue in Kazakhstan-Egypt Relations -------------- -------------- ¶2. (SBU) In a September 8 meeting, Egyptian Embassy Second Secretary Mohamed Salah Keshtah discussed with poloffs the Kazakhstan-Egypt bilateral relationship, as well as the August 29 visit to Astana of Egyptian Trade and Industry Minister Rachid Mohamed Rachid. Egypt-Kazakhstan bilateral trade rose significantly in 2008 -- exceeding $233 million for the first five months of the year, in comparison with trade turnover for all of 2007 of just $76 million. Keshtah explained to poloffs that Egypt's imports of Kazakhstani wheat are the most important component of bilateral trade, and securing more wheat from Kazakhstan had been a principal aim of the visit of Minister Rachid, who had meetings with President Nazarbayev, Prime Minister Masimov, and Foreign Minister Tazhin. ¶3. (SBU) During the Rachid visit, Nazarbayev said publicly that with the lifting of Kazakhstan's wheat export ban, Kazakhstan would export 1,000,000 tons of wheat to Egypt in 2008 -- up from 329,000 tons in 2007. However, according to Keshtah, the exact amount for 2008 is still under negotiation and will depend on Kazakhstan's overall wheat harvest. He expects that in the end, the actual amount will be between 500,000 and 700,000 tons, not 1,000,000 tons. Poloffs asked Keshtah about reports that some countries -- for example, Saudi Arabia -- are trying to secure arable land for growing agricultural products in countries such as Kazakhstan. Keshtah admitted that such an arrangement had been discussed between Egypt and Kazakhstan, but said that the logistical issues proved so overwhelming that no agreement could be reached. -------------- -------------- Registration Process Hampers Pharmaceutical Exports -------------- -------------- ¶4. (C) Keshtah told poloffs that Egypt is exporting approximately $4 million of pharmaceuticals to Kazakhstan annually and sees this as a potential growth area, especially given that pharmaceutical production costs are much lower in Egypt than in Kazakhstan. However, Kazakhstan's complex pharmaceutical registration process is a barrier to increasing Egyptian exports. Egyptian Health and Population Minister Hatem Mostafa El-Gabaly may visit Kazakhstan soon to discuss, among other things, pharmaceutical trade issues. (Note: El-Gabaly's potential visit is also connected to an upcoming conference in Egypt on avian influenza. Kazakhstan, which has a biotechnology center that claims to have discovered a vaccination for avian influenza, is expected to be an active participant at the conference. End Note.) -------------- Late Notice on Common World Forum -------------- ¶5. (C) Keshtah noted that Foreign Minister Tazhin has asked for high-level Egyptian government representation at the October 17 ministerial meeting of the Common World Forum, a Nazarbayev initiative aimed at encouraging dialogue between the West and the Muslim world. According to Keshtah, the Egyptian plan is to send Religious Endowments (Awqaf) Minister Mahmoud Hamdy Zakzouk, as well as a deputy minister of culture. Keshtah voiced frustration that the Egyptian Embassy had received very late notice about the August 28-29 Common World Forum senior officials meeting, which overlapped with Rachid's visit. He said he had not had enough time to ASTANA 00001808 002 OF 002 have Egyptian government legal experts review the proposed text for the Common World Forum's final communique (the so-called "Astana Declaration.") Keshtah said Egypt hoped to find compromise language, particularly for the two paragraphs still in brackets (regarding the Alliance of Civilizations and women's rights) about which the United States has expressed concerns. -------------- Concerns Regarding CICA -------------- ¶6. (C) Poloffs asked Keshtah about Egypt's role in the Conference on Confidence Building Measures and Interaction in Asia (CICA),another Nazarbayev initiative, which held a ministerial meeting in Almaty on August 25. (Note: Egypt is a CICA member state; the United States holds CICA observer status. End Note.) Keshtah said that India is far more active in CICA than Egypt, and maintained that the countries most active in CICA are each using the forum to pursue their own independent objectives. Several years ago, Egypt raised objections regarding some of the issues under consideration by CICA, but the Kazakhstanis did not take these concerns into account, Keshtah claimed. As a result, Cairo had instructed the Egyptian Embassy in Kazakhstan to attend CICA activities, but to "participate passively." -------------- Plans for Egyptian Culture Week -------------- ¶7. (SBU) Education and culture are also important issues in the Kazakhstan-Egypt bilateral relationship, according to Keshtah. As an example of strong cultural and educational ties between the two countries, Keshtah mentioned the Egyptian-Kazakh Nour Mubarak University in Almaty, which teaches secular subjects and "religion in a moderate way." The university is currently in the process of opening a large new building. The Egyptian Embassy, which recently moved to Astana from Almaty several months ago, is also planning to hold an Egyptian Culture Week. Activities, including Egyptian movie screenings, folk-dance performances and exhibits by Egyptian artists, will take place for three days each in Astana and Almaty. President Nazarbayev has great respect for Egyptian culture, Keshtah maintained, and had once sent his personal airplane to Egypt to fly the head of the Al-Azhar foundation to Kazakhstan for a visit. Keshtar also noted that Kazakhstan and Egypt had co-funded activities connected to Sultan Baibars. (Note: Baibars, a Kipchak Turk from the Kazakh steppe, was a Mameluke Sultan of Egypt and Syria in the 13th century. Following Nazarbayev's March 2007 visit to Egypt, the press reported that Kazakhstan was also considering spending one million dollars to help complete the restoration of the Sultan Baibars Mosque in Cairo. End Note.) -------------- Kazakhstani Students Deported from Egypt -------------- ¶8. (C) Keshtah told poloffs that at present, approximately 400 students from Kazakhstan are studying at Egyptian universities on scholarships. He said that the Egyptian government has deported some Kazakhstani students, along with students from other Central Asian universities, because of their purported involvement in Wahabi-style groups. While Keshtah maintained that none of the Kazakhstani students had been linked to terrorist cells, he noted that some Kazakhstani students were susceptible to Wahabi-style groups, whose activities the Egyptian government does not find acceptable. MILAS