Germany and Kazakhstan Seal €3 Billion Raw Materials Deal
Thursday 9 February 2012
BERLIN (Reuters) – Germany and Kazakhstan signed a cooperation deal on Wednesday designed to give German firms greater access to raw materials in the resource-rich Central Asian country in exchange for technology and know-how.
- Kazakh President Nursultan Nazarbayev held talks on Wednesday with German Chancellor Angela Merkel and representatives from the German Council on Foreign Relations (DGAP) as well as the Committee on Eastern European Economic Relations on a range of trade issues. Kazakhstan hopes to win over the European Union as another key trade partner alongside Russia and China. Experts see the Berlin visit of Kazakh President Nursultan Nazarbayev as paving the way.
(Photo: © AP)
As part of the deal, struck during a visit to Berlin by Kazakh President Nursultan Nazarbayev, German companies signed 50 separate contracts worth a total of €3 billion, the German economy ministry said.
These include an agreement between Siemens and Kazakhstan’s state railway company to modernise the rail network in the former Soviet state, as well as smaller deals involving German industrial gases group Linde, chemicals group Lanxess and steel firm ThyssenKrupp.
Among them are deals aimed at ensuring future access for German companies to the 17 elements known as rare earths that are vital for the production of technology ranging from electronic chips to solar panels and batteries used in hybrid automobiles. Most of the elements currently come from China.
Although Germany’s trade with Kazakhstan grew by 20% last year to around €6.3 billion, France and other European partners have invested more in the Central Asian nation, which is eager for investments into its infrastructure and manufacturing sector. The German move comes after Europe’s largest economy signed a similar deal in October 2011 with Mongolia, which also holds vast undeveloped reserves of minerals including rare earths.
Kazakhstan holds large amount of uranium deposits and is an emerging leader in producing the yellow cake required by nuclear plants. It also has the largest oil reserves outside the Middle East and has recently begun to exploit and explore its rare earths deposits. Its abundant mineral wealth has enabled its economy to post strong growth rates over the past seven years, spurred by the rising prices of commodities.