Financial Times
November 12

Discussion of business and trade cooperation between Israel and states of the former USSR usually focuses on Russia and the Ukraine. Yet there are other prospective partners, among them Muslim republics Uzbekistan and Kazakhstan.

Uzbekistan, which has a population of 25 million, has a gross domestic product (GDP) of close to $60 billion. Industry accounts for 36% of the GDP, agriculture for 39%.

The republic's GDP fell 15% in the four years after the fall of the Soviet Union. By 1997, however, the trend reversed and the GDP achieved a growth rate of 1%.

Uzbekistan has an average annual economic growth of 4%. Its large mining industry produces copper, gold, silver, lead, zinc, tungsten, and molybdenum, and its has the fourth largest gold reserve in the world. Uzbekistan also has large natural gas reserves.

The country's manufacturing industry is dominated by the production of chemical items such as fertilizers, artificial filaments, and plastics; agricultural, chemical, electric, and textile machinery; and aircraft.

The agriculture industry is dominated by irrigation, silk-worm breeding, cotton, viticulture, corn, and sheep breeding.

While trade between Israel and Uzbekistan is relatively insignificant, reaching only $6 million per year - of which 60% is Israeli exports - economic cooperation between the two countries seems to be increasing.

One of the largest joint ventures is a $220m. contract for the design, supply, and management of a booster compressor station for natural gas in Uzbekistan, to be carried out by Haifa-based Bateman Projects. Metek, also an Israeli company, is involved in a local mining and metallurgic plant project at Almalick.

Uzbek specialists are studying irrigation technology and water conservation at Israeli research centers, and there are several planned joint public health projects.

Neighboring Kazakhstan has a population of nearly 18 million people. Industry accounts for 39% of its GDP of $85b., while agriculture is responsible for another 34%.

In 1997 and 1998 its average annual rate of economic growth was 2.5%. Since then the rate has increased, and in 2001 it reached 13%, mainly due to industrial production.

The economic growth forecast for 2002 is 7%. Inflation, which was 40% a year in 1996, is now at 5%-7%.

Kazakhstan has a powerful non-ferrous metallurgy industry, and its iron and steel, coal mining, and oil and gas production industries are also strong. The manufacturing industry includes the production of building materials and chemical machinery, and oil refining. Cattle breeding and the production of wheat and fruit dominate the agriculture industry.

Kazakh President Nursultan Nazarbaev, a well-known supporter of the "Eurasian Union" and former iron and steel worker, is focusing his efforts on the development of new oil fields, in an effort to reach by 2020 levels of oil production close to those of Saudi Arabia and Russia.

Israeli companies will find business opportunities mainly in the construction of objects of non-ferrous metallurgy, building materials, and research in resource conservation.

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