WORLD TRADE  
ORGANIZATION  RESTRICTED 
WT/ACC/SPEC/KAZ/7/Add.3 
12 September 2011 
 (11-4385) 
Working Party on the 
Accession of Kazakhstan Original:   English 
 
 
 
ACCESSION OF KAZAKHSTAN 
 
Questions and Replies concerning 
Domestic Support and Export Subsidies in the Agricultural Sector 
 
Addendum 
  
 The following submission, dated 19 July 2011, is being circulated at the request of the 
Delegation of the Republic of Kazakhstan. 
 
______________ 
 WT/ACC/SPEC/KAZ/7/Add.3 
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  - G
ENERAL COMMENTS  
Question 1 We thank Kazakhstan for the updated Domest ic Support and Export Subsidies tables.  
Updating this information to the 2006-2008 time period is an extremely important step in being 
able to inform the Working Party of the mo st current and accurate description of the 
agricultural situation in Kazakhstan.  We commend Kazakhstan for undertaking what was 
undoubtedly an extensive effort to pr ovide this important information.  
We also thank Kazakhstan for the Comp endium of Domestic Support Programmes 
(JOB/ACC/12).  This detailed and extensive info rmation is quite useful in evaluating and 
understanding the nature and scope of Kazakhstan' s domestic support programmes listed in the 
DS Tables.   
Having such updated and extensive information is  critical in helping move the Working Party 
report forward, and again we appreciate Kazakhs tan's good faith efforts in providing this 
updated information. 
We do note that Kazakhstan again has noti fied certain domestic support programmes under 
Article 6.2 Special and Differential Treatment Provisions.  It remains our position that 
Kazakhstan does not have recourse to Article 6.2 provisions and should move these programmes to other supporting tables, as appropriate.   
Answer 
Agriculture is a key sector and it plays an important role in the field of economic and social 
development in Kazakhstan, since nearly 47 per cen t of Kazakhstan's population lives in rural areas.  
Taking into account income per capita of rural citizens (US$256 per capita as of 2009) Kazakhstan 
could be considered as a low-income country (i n accordance with the World Bank classification).  
Moreover, with respect to the United Nations classifi cation, Kazakhstan is referred to the "landlocked 
developing countries" group.   
Furthermore, the Government recently has launc hed development programmes in the agricultural 
sector as the development level of this sector still re mains below the level of 1990, especially in the 
livestock production sector.  For instance, the number of cattle is still lower by 40 per cent than that in 
1990.  It should be noted that livestock production in Kazakhstan is characterized by low productivity 
because over 90 per cent of livestock is kept by ho useholds which use manual works and low quality 
cattle breeds.  For instance, average milk-yield in  Kazakhstan is equal to 2,000 litres per cow a year, 
whereas average milk-yield  in the countries with the developed industrial type of production reached 
7,000-8,000 litres per cow a year.   
As for agricultural crops, due to dry and sharply continental climate Kazakhstani farmers cultivate 
agricultural crops in a zone of risky agriculture.  Su ch condition for nearly all crops is one of the most 
extreme conditions in the world as it increases costs and reduces agricultural output.  For this reason, 
agricultural output in Kazakhstan is very low in co mparison to other countries.  For instance, in 2009 
wheat yield in Kazakhstan was equal to 9 quintal per hectare, while in Australia  it reached - 16 quintal 
per hectare, in Canada - 28, in USA - 30, in Saudi Arabia - 61 and in Japan - 70.  Therefore, due to 
low profitability all agricultural producers in Ka zakhstan could be considered as low-income or 
resource-poor agricultural producers.   
Thus, Kazakhstan seeks special and differential treatment for its domestic support commitments 
granted to developing countries and had been provi ded to a number of acceded countries with similar  WT/ACC/SPEC/KAZ/7/Add.3 
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  structure of economies. In particular, Kazakhstan wo uld seek recourse to the provisions of Article 6.2 
of the Agreement on Agriculture and 10 per cent de minimis . 
Question 2 
We note that Question 11 on page 9 of document WT/ACC/SPEC/KAZ/7/Add.2 dated 
17 October 2005 highlights previous concerns exp ressed regarding Kazakhstan acceding to the 
WTO as a developed country, but seeking to use Special and Differential Treatment flexibilities 
in agriculture. 
We are disappointed to observe that Kazakhstan seeks to continue with this approach and we 
urge Kazakhstan to reconsider. 
In this context, we note that our comments  and questions on agricultural programmes that 
Kazakhstan has identified in the documents unde r review are offered without prejudice to our 
position that Kazakhstan should abide by the self- selection it has made of its development status 
in relation to the whole WTO Agreemen t, which is as a developed country. 
Answer 
Taking into account of the recent accessions (Saudi Ar abia, Viet Nam and etc.), Kazakhstan considers 
itself as a developing country in the context of WTO accession.  As a ''developing country'' 
Kazakhstan seeks for the recourse to the Special a nd Differential Treatment provisions stipulated by 
Articles 6.2 and 6.4 of the Agreement on Agriculture.  
Furthermore, please see the answer to the Question 1. 
Question 3 
Regarding sub-totals provided for each agricul tural programme, we would suggest following 
the usual practice of placing the sub-total calcul ation at the bottom of each entry, rather than 
the top, for ease of reference and to avoid confusion. 
Answer 
Kazakhstan takes account of this comment and w ill make the necessary amendments in the table. 
Question 4 
It would be helpful for the understanding of the calculations, and also in line with document 
WT/ACC/4, if the three-year averages of the yearly data were also presented. 
Answer 
Kazakhstan takes account of this comment and w ill make the necessary amendments in the table. 
Question 5 
Input subsidies are known to be one of the mo st distorting means to provide support to 
agriculture, as those subsidies tend to lead to overuse of such inputs.  Could Kazakhstan 
provide any indications as to the reasons why it favours input subsidies instead of resorting to  
non-distorting policies, such as those provided for in the Green Box (Annex 2 of the Agreement on Agriculture). WT/ACC/SPEC/KAZ/7/Add.3 
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  Answer 
As stated above, Kazakhstan has been implementin g a set of agricultural support measures under the 
Programme of Development of Agricultural Sect or in Kazakhstan for 2010-2014 approved by the 
Government Resolution No. 1052 of 12 October 2010,  which continues implementation of the similar 
programme for 2006-2008 approved by the Govern ment Resolution No. 149 of 6 March 2006.  
The programme focuses on solving the following proble ms in the sector, revealed during the analysis:  
slow technological modernization of equipment and machinery, poor infrastructure, prevalence of low productive households, financial instab ility of farmers, low interest of private investors, deficit of 
qualified cadre etc.  Moreover, fi nancial and subsequent food cr ises revealed additional problems 
related to investments into the sector.  For instance,  lack of financial resources impede farmers to 
apply mineral fertilizers and herbicides, which ar e important for maintaining soil fertility and 
phytosanitary safety of agricultural land in the whole.  Over 80 per cent agricultural machinery and 
equipment in use have been worn out.  This re quires expensive investments that farmers are not 
capable to accomplish without support from the Government under leasing programme.   
- Supporting Table DS:1 
Question 6 
We note that there are significant increases and/or  variation in year to year expenditure for a 
number of programmes.  For example: 
- Training services - training for government officers; 
- Extension and advisory services - Int ernational Bank for Reconstruction and 
Development Project - "Agricultural Post-Privatization Assistance"; 
- Extension and advisory services - Asian Bank for Development Project - "Water 
Resources Management and Land Rehabilitation"; 
- Extension and advisory services - Int ernational Bank for Reconstruction and 
Development Project - "Irrigation and Drainage Systems Improvement"; and 
- Inspection services - inspection of agricultural crops for grading purposes. 
Could Kazakhstan please explain the reasons  behind such variations in programme 
expenditure? 
Answer 
1. Programmes which had an upward trend: "Tra ining for government officers" and "Inspection 
of agricultural crops for grading purposes".   
As regards the programme of "Training for gove rnment officers", budget expenditures from 2006 to 
2007 were increased to address the needs of the farmers in up-to-date knowledge in farming 
technologies.  The programme provides for training of government officers who, in turn, provide trainings to farmers.  In particular, the trainings  focus on transfer information and technical support 
relating to food security, farm risk mitigation, how to increase crop yields and other needs specific to 
geographical location of a particular farm.   
As for "Inspection of agricultural crops for grading purposes" progra mme, in 2008 apart from 
expenditures allocated for inspec tion services, the Government had also funded upgrade of facilities 
of the seeds inspection service, in particular, cons truction of new laboratories for seeds inspections, 
modernized and improved seeds grading faciliti es and increased the quantity of seeds grading 
techniques.  Therefore, the amount of money under the programme in question was increased by more 
than three times from 2007 to 2008.  WT/ACC/SPEC/KAZ/7/Add.3 
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  2. Programmes which had a downward trend:  "Water Resources Management and Land 
Rehabilitation" and "Irrigation and Dr ainage Systems Improvement".   
These programmes were funded under the Agreements  with the Asian Development Bank and the 
World Bank, respectively, which were implemente d within 1998-2007.  In 2008, the Government 
completed the implementation of these programmes.   
3. Programme which had a variation trend:  "Agricultural Post-Privatization Assistance" 
The Agricultural Post-Privatization Assistance Proj ect aimed at supporting newly privatized farms 
and enterprises in eight oblasts of Kazakhstan th rough establishment of rural advisory centres.  
This component was aimed at strengthening info rmation for agricultural producers on market 
principles, such as shareholder rights, and build lo cal business support infrastructure to deliver advice 
and training on technical and commercial practices.  Expenditures varied according to the needs of 
agricultural producers in advisory service. 
Question 7 
We note that the description for training services reads "Training of government officers.  
Budget allocations to set up training to impr ove professional skills of government officers - 
employees of the Ministry of Agriculture etc. ".  Could Kazakhstan please explain how this 
programme is consistent with Annex 2, paragrap h 2 - General Services?  How does the training 
of government officers provide a direct benefit to agriculture or the rural community?  Further, could Kazakhstan provide further detail on how this programme is administered, in particular, who receives the training? 
Answer 
The support is compliant with the criteria of 2(c) of the Annex 2 to Agreement on Agriculture as it 
covers the cost of conducting professional training, including basic and advanced specialist training to 
improve professional skills of government officers – employees of central administrative office of the 
Ministry of Agriculture, Committees (Committees of State Inspection in Agribusiness Industry, Water 
Management, Forestry and Hunting Farm, Fishing Industry and Development of Rural Territories) 
and their Territorial bodies in 14 oblasts and in Astana and Almaty cities.   
The training programme was designed to address the needs of the farmers in up-to-date knowledge in 
farming technologies, for instance, how to make better use of agricultural science, knowledge and 
technology.  Apart from the technical modules, other training courses were also organized, such as veterinary diagnostic development,  plant quarantine, food safety, etc.  The programme provides for 
training of government officers who, in turn, provide trainings to farmers.  Therefore, the training of 
government officers provides a direct benef it to agriculture and rural community.  
Question 8 
We note that "Institutional development of agric ultural services" is classified as being both 
(d) extension and advisory services and (f) ma rketing and promotion services.  We would 
suggest that this programme be classified as , either (d) extension and advisory services, or 
(f) marketing and promotion services, rather than both. 
Answer 
Kazakhstan takes account of this comment and w ill make the necessary amendments in the table. WT/ACC/SPEC/KAZ/7/Add.3 
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  Question 9 
Could Kazakhstan please explain how the "Paym ent for relief from natural disasters" 
programme complies with the criteria of paragr aph 8(a)-(e) of Annex 2 of the Agreement on 
Agriculture?   
In particular, could Kazakhstan advise whether p ayments are determined by a production loss 
that exceeds 30 per cent of the average production in the preceding three-year period or a  
three-year average based on the preceding five-yea r period, excluding the highest and the lowest 
entry, as set out in paragraph 8(a) of Annex 2? 
Answer 
This programme complies with the criteria of pa ragraph 8(a)-(e) of Annex 2 of the Agreement on 
Agriculture.  In particular, pursuant to the Gove rnment Resolution of the Republic of Kazakhstan 
No. 407 "On Approval of Regulatory Legal Acts in th e Field of Veterinary" of 28 April 2003, based 
on results of laboratory tests, a head of local executive body (Akim) takes a decision on imposition of quarantine or restrictive measures when outbreak of highly pathogenic and infectious animal disease 
occurred.   
The payments shall be made only in respect of a type of disease in cluded into the List of Highly 
Pathogenic/Infectious Diseases approved by the same  Government Resolution.  For these purposes a 
special Commission is formed on an ad hoc  basis upon:  (i) request of the chief veterinary and 
sanitary inspector of the relevant territorial body of the Committee of the State Inspection in 
Agribusiness Industry of the Ministry of Agriculture (furthermore – territorial body) and (ii) Ordinance of the territorial branch of the veterinary service.  
The Commission shall consist of representatives of  local executive bodies, the Committee of Sanitary 
and Epidemiological Surveillance of the Ministry of  Public Health and chief veterinary and sanitary 
inspector of relevant territorial body.  When suspected animals are confirmed with the highly 
pathogenic disease included into the List, all susceptible livestock, presented in the establishment/farm, are subject to stamping out at the cost of state budget.   
Payments shall be made by the decision of  the Commission upon submission of the following 
documents:  (i) decision of the local executive body on implementation of restrictive measures or quarantine on animal diseases; (ii) formal note on  destruction and stamping out of suspected animals 
signed by the Commission members; (iii) report issued  by a veterinary laboratory upon the results of 
diagnosis or veterinary and sanitary expertise; (iv) ordinance of the state veterinary-sanitary inspector 
of district (city) on destruction of affected animals; (v) veterinary passport.   
Upon the decision of Commission, the Government compensates 100 per cent of the quantity of 
livestock destroyed.  Maximum compensation amounts are fixed by the Government Resolution of the Republic of Kazakhstan No. 407 "On Approval of Regulatory Legal Acts in the Field of Veterinary" 
of 28 April 2003 and vary by animal type, class and age.  However, the total amount of payments per 
head of destroyed livestock, per kilogram or un it shall not exceed 80 per cent of market price of 
livestock or product in question.    WT/ACC/SPEC/KAZ/7/Add.3 
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  Question 10 
In several cases the claim for compliance with ea ch and every criterion in Annex 2 of the 
Agreement on Agriculture is based on assertion rather than by explaining how the programme 
related to those criteria.  This is the case for some general services, where it is not always 
obvious that the programme does not provide a di rect payment to producers or processors.   
Regarding "Payment for relief from natural disa sters", how do these payments meet each and 
every criterion of Paragraph 8 of Annex 2 of the Agreement on Agriculture?   
Answer 
Please see the answer to Question 9. 
Question 11 
Regarding "Storage and handling of state reserv e of grain for food security purposes", could 
Kazakhstan provide information to show (1) what are the "officially published objective 
criteria" referred to in footnote 5 of Annex 2 of the Agreement on Agriculture, and (2) on what 
grounds this programme would meet these criteria?   
Answer 
Pursuant to Article 11 of the Law No. 143 of  the Republic of Kazakhstan "On Grain" of 
19 January 2001, the Government for the purpose of ensuring food security goals shall procure grain 
from agricultural producers into the state grain reser ves.  For this purpose, the Government annually 
allocates funding for the procurement of grain.  The Government sets amount of funding based on 
current market price of the product.  Pursuant to the Resolution of the Government of the Republic of 
Kazakhstan No. 34 "On Approval of Volumes of the St ate Reserves of Food Grain" of January 2006, 
the volume of wheat to be procured into the state re serve is fixed and equal to 500,000 metric tonnes.  
The Government annually renews the state food gr ain reserves through its designated agent - the 
"Food Contract Corporation" (hereinafter - the FCC) since 1998.   
When setting the purchase price on grain, the Governme nt takes into account that the price shall cover 
the production costs of agricultural producers and to  ensure some minimal level of profitability for 
further development.   
The programme complies with the criteria of paragraph 3 of Annex 2 of the Agreement on 
Agriculture as it forms a basic part of food secu rity programme for the purposes of food security 
stipulated in the national legislation.  Furthe rmore, the difference between the purchase price and 
external price was calculated in  the Supporting Table DS:5.   
Question 12 
Paragraph 2(b) - Pest and disease control:  Do measures related to controlling agricultural 
crops' pests and diseases include spraying crop pe st for producers in general?  Can Kazakhstan 
confirm that these are not a subsidization of an input cost?   
Answer 
The authorized body applies a range of measures designed to reduce losses in crop yield caused by 
pests, diseases and weeds as well as to keep crops free from pests.  Apart from the measures listed on WT/ACC/SPEC/KAZ/7/Add.3 
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  page 4 of the document JOB/ACC/ 12 dated 17 November 2010, it also applies such common method 
of pest control as spray of pesticides on arable la nds affected by highly pathogenic diseases and pests 
included into the List of Extremely Hazardous Di seases and Pests approved by the Resolution of the 
Government of the Republic of Kazakhstan No. 1295 of 10 December 2002.  The List includes the most common types of highly pathogenic diseases and pests, such as scutelleridae , locust, Hessian 
fly, anisoplia , helicoverpa zea , tetranychidae , etc. 
Kazakhstan confirms that these are not a subsidization of an input cost.   
Question 13 
Paragraph 2(b) - Pest and disease control:  Do  measures related to maintaining favourable 
epizootic situation for agricultural animals include purchasing veterinary medicine for 
producers in general?  Can Kazakhstan confirm th at these are not a subsidization of an input 
cost?   
Answer 
The programme "Maintenance of epizootic welfare"  covers only diseases included into the List of 
Highly Pathogenic/Infectious Animal Diseases, Pr ophylactics, Diagnostics and Liquidation of which 
are Subject to Budget Funding, adopted by the G overnment Resolution of the Republic of Kazakhstan 
No. 407 of 28 April 2003 and consists of the fo llowing sub-programmes:  (i) procurement of 
veterinary vaccines to be applied by private veteri narians to farm animals; (ii) diagnostic measures 
provided by state veterinary laboratories; (iii) me asures on localization and liquidation of outbreaks of 
highly pathogenic and chronic infectious diseases.   
Kazakhstan confirms that these measures do not re present subsidization of an input cost.   
Question 14 Paragraph 2(d) - For extension, advisory, in frastructure, and market promotion services 
provided under IBRD, ABD, and World Bank projects, can Kazakhstan confirm that the amounts listed only account for funds from Kaza khstan's budget and not the portion of aid or 
assistance from IBRD, ABD or World Bank?  If funds reported are grant funds from IBRD, 
ABD or World Bank, they should not be repor ted as Kazakhstan's support to producers.  
If they are Kazakhstan's cost share funds, or f unds used to repay loans from these institutions, 
then they should remain in the tables.   
Answer 
Funding indicated under the programmes of "Agric ultural Post-Privatization Assistance" (IBRD 
Project), "Water Resources Management and La nd Rehabilitation" (ABD Project), "Irrigation and 
Drainage Systems Improvement" (IBRD Project) and "Institutional develo pment of agricultural 
services" (WB Project) represent the portions of cost share funds of the state budget.   
Question 15 
Paragraph 2(e) – "Determination of sort and so wing qualities of seeds and planting materials":  
Can Kazakhstan clarify the scope of the progra mme, for example, is testing done for all seeds 
intended for planting?  Is this service provided free of charge to producers?  Can Kazakhstan 
confirm that these are not a subsidization of an input cost?    WT/ACC/SPEC/KAZ/7/Add.3 
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  Answer 
Pursuant to the Resolution of the Government of the Republic of Kaza khstan No. 805 "On Approval 
of Rules of Evaluation of Sort and Sowing Qu alities of Seeds Conducted at the Expense of 
Republican Budget, Including those Seeds, Inte nded for Planting by Domestic Agricultural 
Producers" of 12 August 2003, evaluation of sort a nd sowing qualities of seeds and planting materials 
is carried out on a compulsory basis for all agri cultural producers, including elite seed producing 
farms, state varietal-testing stations and the stat e resources of seeds.  This service is provided on a 
free-of-charge basis to all agricultural producer s by laboratories conducting seed testing.   
Question 16 Paragraph 8 – Payments for relief from natu ral disasters:  Can Kazakhstan confirm that 
eligibility for the payments adheres to the 30 per cent threshold as required by paragraph 8(a) 
of Annex 2 to the Agreement on Agriculture?   
Answer 
Please see the answer to the Question 9. 
- Supporting Table DS:2 
Question 17 With regard to Supporting Table DS:2, we rei terate our concerns regarding Kazakhstan 
acceding to the WTO as a developed country, but seeking to use Special and Differential 
Treatment flexibilities in agriculture.   
Answer 
Kazakhstan notes that, nevertheless, among recent accessions there are su ch precedents when a 
country, without being formally granted a developi ng country status, received certain preferences 
available for developing countries.  For instance, Saudi Arabia was granted 10 per cent de minimis  for 
its AMS reduction commitments.  Similarly, China acceded with 8.5 per cent de minimis.    
Agriculture is a key sector of economy and plays important role in economic and social development 
of Kazakhstan, since nearly 47 per cent of Kazakhs tan's population live in rural areas.  Taking into 
account income per capita of rural citizens (US $256 per capita as of 2009) Kazakhstan could be 
considered as a low-income count ry (in accordance with the World Bank classification).  Moreover, 
in the United Nations classification, Kazakhstan is  referred to the group of  "landlocked developing 
countries".   
Furthermore, as the Government had started to im plement market economy reforms in the agricultural 
sector since gaining independence by the country, th e development level of this sector still remains 
below the pre-reform stage, especi ally in the livestock production sector.  For instance, the number of 
cattle is still lower by 40 per cent than in the pre -reform stage. Livestock pr oduction in Kazakhstan is 
characterized by low productivity because over 90 per cent of livestock is kept by households which 
use manual works and low quality cattle breeds.  For instance, average milk-yield in Kazakhstan is 
equal to 2,000 litres per cow a year, whereas average milk-yield in the countries with the developed 
industrial type of production reached  7,000-8,000 litres per cow a year.   
As for agricultural crops, Kazakhstan due to dr y and sharply continental climate, cultivates 
agricultural crops in a zone of high risk agricu lture.  Such conditions for nearly all crops are WT/ACC/SPEC/KAZ/7/Add.3 
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  considered as one of the most extreme conditio ns in the world as it increases costs and reduces 
agricultural output.  For this reason, agricultural output in Kazakhstan is very low in comparison to 
other countries.  For instance, in 2009 wheat yield in Kazakhstan was equal to  9 quintal per ha, while 
in Australia it reached - 16 quintal per ha, in Cana da – 28, in USA – 30, in Saudi Arabia - 61 and in 
Japan - 70. Therefore nearly all agricultural prod ucers in Kazakhstan could be considered as  
low-income or resource-poor producers and, subs equently, Kazakhstan shoul d be considered as a 
developing country within the WTO or receive certai n preferences available for developing countries.   
Question 18 
We observe that for a measure to be included in Supporting Table DS:2 it must satisfy the 
criteria set out in Article 6.2 of the Agreement on Agriculture.   
On pages 37 and 38 of document JOB/ACC/12 it is  indicated that the "Subsidies for Livestock 
Breeding" programme covers costs of off-farm en terprises such as slaughterhouses, processing 
plants and factories.  Could Kazakhstan expl ain how this programme meets the criteria of 
investment subsidies under Article 6.2?   
Answer 
The full name of the programme looks as follows  - "Support of Production, Processing and Marketing 
of Livestock Products".  Kazakhstan understands that this programme is  inconsistent with the criteria 
of investment subsidies under Article 6.2.  K azakhstan will make the necessary amendments and 
report this measure in Supporting Table DS:9.    
Question 19 
Could Kazakhstan explain how the following prog rammes meet the criteria of input subsidies 
being generally available to low-in come or resource-poor producers?   
- Soft loans for spring-field and harvesting works; 
- Partial compensation of feedstuff cost; - Support for livestock breeding; - Support for seed breeding; 
- Soft loans for agricultural producers - small businesses; and 
- Soft loans from local budgets for resource poor  agricultural producers at the local level. 
Answer 
Under indicated programmes the Government provid es support in the form of input subsidies and 
loans under below-market interest rates to encour age low-income agricultural producers to purchase 
inputs for the entire process of agricultural producti on. Such inputs include feedstuff, elite seeds, 
breeding stock products, etc.   
In Kazakhstan about half of country's population resid es in rural areas. Income  of rural citizens' is 
equal to US$256 per capita.  By contrast, national average income is equal to US$456 per capita.  
In accordance with the World Bank classificati on, all agricultural producers except for large 
agricultural enterprises, are considered "low-incom e producers" and are eligible for the programmes 
listed in the Supporting Table DS:2 under the Article 6:2 of the Agreement on Agriculture.    WT/ACC/SPEC/KAZ/7/Add.3 
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  Question 20 
With particular regard to the "Partial compensati on of feedstuffs cost", it is noted that the 
"subsidies are paid to domestic agricultural pro ducers specialising in production of beef, pork 
and poultry meat" (pages 50 and 51 of document JOB/ACC/12 refer).  Could Kazakhstan clarify whether subsidies under this measure are available to all agricultural producers or 
limited to either low-income or resource-poor producers?   
Answer 
Within the period of 1993-1999 the output of livestoc k production decreased significantly.  This was 
caused mainly by reduction of number of cattle - from 9 million to 3 million.  Number of low-income households which use manual works and out-dated ag ricultural machinery still prevail in the sector.  
The quality of feedstuff decreased because of the fa rmer's failure to comply with the technological 
requirements for its production.  Development of feed crops was suspended.  Natural pastures, 
especially in the remote areas are used ineffici ently.  For this reason, Kazakhstan considers all 
livestock production farms as low-income and resource-poor producers.   
Question 21 
With particular regard to the "Soft loans for agricultural producers - small businesses" 
programme, could Kazakhstan clarify what is meant by "small businesses"? Are these 
businesses either low-income or resource-poor producers? 
Answer 
In the process of agrarian restructuring in the 1990s the majority of agricultural producers had faced 
the problem of insolvency.  For this reason, th e Government has developed programme devoted to 
providing loans for farmers with the purpose of supporting the small rural businesses.  The term 
"small businesses" is referred to small-sized peasant (private) farms.  In general, such farms are 
physical rather than legal persons.  Small-sized  peasant farms in Kazakhstan are considered as  
low-income agricultural producers.   
Question 22 
Our view is that Supporting Table DS:2 would no t be applicable, as recourse to Article 6.2 
would not be available. In acceding as a develope d country, i.e. without being able to exempt 
support under Article 6.2 and with a 5 per cent de minimis  percentage, Kazakhstan will be 
expected to, instead of reporting policies in  Supporting Table DS:2, report them in those 
Supporting Tables that feed into Supporting Table DS:4.   
Answer 
Please see the answer to Question 1. 
Question 23 
As previously stated, it is our position that  Kazakhstan does not have recourse to Article 6.2 
provisions and thus Supporting Table DS:2 should be eliminated and the information moved to 
other tables, as appropriate. WT/ACC/SPEC/KAZ/7/Add.3 
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  Answer 
Please see answer to Question 1. 
Question 24 
We note that Kazakhstan has not included any aid and/or assistance from multilateral 
institutions.  Would Kazakhstan confirm non re ceipt of aid or assistance from multilateral 
institutions?   
Answer 
Kazakhstan had cooperated with the international organizations within the following projects which 
provided soft loans to farmers for reconstruction of  irrigation systems located in Southern Kazakhstan 
as well as consulting services for implementation of the projects:   
- International Bank for Reconstruction an d Development Project "Agricultural  
Post-Privatization Assistance"; 
- Asian Bank for Development Project "W ater Resources Management and Land 
Rehabilitation"; and 
- International Bank for Reconstruction and De velopment Project "Irrigation and Drainage 
Systems Improvement". 
The support under the projects is presented in th e Domestic Support Tables of Kazakhstan for  
2006-2008. 
Question 25 
Could Kazakhstan please clarify input costs?  In  measure type (a) woul d investors also qualify 
for these subsidies?  Would Kazakhstan stat e the criteria for "low-income" and/or  
"resource-poor" farmers in measure type (b)?   
Answer 
- Measure type (a) investment subsidies: 
Investors are not qualified for the investment subsid ies.  This type of subsidy is granted only to 
domestic agricultural producers to encourag e agricultural and rural development.   
Under this measure government allocates budget res ources to the programme aimed at increasing the 
supply of agriculture machinery on the one hand, and at reducing the costs of this machinery to 
farmers through financial leasing, on the other.   
- Measure type (b) input subsidies:   "Input subsidies" are provided in order to reduce th e prices that agricultural producers pay for major 
production inputs such as water, fertilizers, pesticides, feedstuff, elite seeds and loan interest rates.  
The input subsidies are available to all agricultu ral producers.  WTO Agreement on Agriculture does 
not contain definitions of "low income" or "resource poor" agricultural producers.   
In Kazakhstan about half of country's population resid es in rural areas.  Income of rural citizens' is 
equal to US$256 per capita.  By contrast, national average income is equal to US$456 per capita.  
In accordance with the World Bank classificati on, all agricultural producers except for large  WT/ACC/SPEC/KAZ/7/Add.3 
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  agricultural producers are considered to be "l ow-income producers" and are eligible for the 
programmes listed in the Supporting Table DS:2  under the Article 6:2 of the Agreement on 
Agriculture.  For this reason, Kazakhstan consider s all livestock production farms as low-income and 
resource-poor producers.   
Question 26 
We seek clarification on the criteria Kazakhstan's farmers must comply with to be eligible to 
programmes listed under the Article 6.2 of the Agreement on Agriculture.  Could Kazakhstan 
provide detailed information about the exact criteria that defines both "low income" and "resource-poor" producers?   
Answer 
Please see answer to Question 1 above. 
Question 27 
We would like a clarification in Kazakhstan's "Soft loans for agricultural producers - small 
businesses" and the "Soft loans from local budget s for resource poor agricultural producers at 
the local level" under Input Subsidies Programme, categorized as Special and Differential 
Treatment (S&DT).  This is because the afo rementioned programmes could fall under AMS and 
are, therefore, subjected to subsidy limitation.   
Answer 
"Soft loans for agricultural producers - small businesses":   
Following the implementation of structural reforms in  agriculture, the newly created farms faced a lot 
of difficulties.  For this reason, the Governme nt had elaborated a programme for crediting of 
agricultural producers with the purpose of supporti ng the small rural businesses.  The term "small 
businesses" is referred to the small sized peasant (private ) farms.  In general, such farms are physical 
rather than legal persons.  Small sized peasant fa rms in Kazakhstan are classified as low-income 
agricultural producers.   
The Government provides soft loans through the "Fund for small business development".  Soft loans 
are distributed for: 
- introduction and operation of a new tec hnology in agriculture production; and 
- purchase of such inputs as tractors, agricultural m achines, fuel and lubricant materials, seeds, 
fertilizers, herbicides, pesticides, vete rinary preparations and cattle breeds. 
"Soft loans from local budgets for resource poor agricultural producers at the local level": Under this programme loans are granted to banks for crediting of resource poor agricultural producers 
at the local level for replenishing of their floa ting assets.  The loans ar e distributed by local 
administrations.  Agricultural producers and sm all rural businesses use the funds to purchase inputs 
for the agricultural production process.   WT/ACC/SPEC/KAZ/7/Add.3 
Page 14  
 
  - Supporting Table DS:4 
Question 28 In the Supporting Table DS:4 for the years 2006 to 2008, Kazakhstan presented its estimated 
value of production of "small cattle".  Could Kazakhstan specify which kinds of livestock are 
included under such denomination? 
Answer 
Kazakhstani statistics distinguishes two most co mmon groups of livestock:  "small cattle" (small 
ruminants) and "large cattle" (big ruminants).  Sma ll cattle consists of sheep and goats.  "Large cattle" 
includes cows and buffaloes.   
Question 29 
What animal species are included in "Small cattle (livestock)"?  Why is the data not 
disaggregated by animal species?  Are there also large cattle?   
Answer 
The data relating to livestock was collected fro m the Agency for Statistics of Kazakhstan and 
"KazAgroProduct" ("former - Mal Onimderi Korporat siyasy") which acts on behalf of Government of 
Kazakhstan as an agent for procurem ent of livestock products.  Both ag encies do not keep a record of 
small cattle disaggregated by species.  Therefore, th e data cannot be disaggregated by animal species.  
This type of livestock does not include large cattle.   
Question 30 
What would Kazakhstan's average Current Total AMS for 2006-2008 be when using a 
5 per cent de minimis  percentage? 
Answer 
Please see answer to Question 1. 
Question 31 
We note that the figures of the AMS for raw cotto n in 2007 in tenge and US$ are not equivalent.  
Could Kazakhstan confirm the value of  the AMS for raw cotton in 2007? 
Answer 
Kazakhstan takes account of this comment and w ill make the necessary amendments in the table. 
- Supporting Table DS:5 
Question 32 Could Kazakhstan explain the criteria used for th e definition of administered prices listed in 
Supporting Table DS:5?    WT/ACC/SPEC/KAZ/7/Add.3 
 Page 15 
 
 
  Answer 
According to the Resolution of the Government of  Kazakhstan No. 45 "On Certain Issues of Support 
of the Agro-Industrial Complex with Involvement of  Specialized Organizations" of 7 July 2006, the 
KazAgroProduct and Food Contract Corporation purchase crops and livestock products on behalf of 
the Government in order to support agricultural producers.   
The data for "applied administered prices" is based  on the actual prices at which both agents purchase 
crops and livestock products directly from agricultural producers.   
Question 33 
What is the source and definition of the three ex ternal reference prices for wheat, the average of 
which would constitute the fixed external referen ce price for wheat for future notifications? 
Answer 
1. The "external reference price" for agricu ltural commodities was based on customs value of 
exported and imported pro ducts provided by Kazakhstan's Custom s Statistics of Foreign Trade.   
Kazakhstan was a net-exporter of wheat in 2006-2008 .  Therefore the calculation of external reference 
price for the period in question was based on export prices.   
The Customs Statistics provides various import-export  data for HS commodities at the 2-, 4-, 6- and 
10-digit levels.  Taking into account that the wheat variety in question is soft wheat except seed, the 
calculation of the reference price is made using data on 10-digit HS EurAzEC Code for soft wheat 
other than seed.   
It should be noted, that Kazakhstan in its Supporti ng Table DS:5 table of November 2010 mistakenly 
used the data on soft wheat and meslin seed instead of the data on soft wheat other than seed and the 
data for the CIS countries was excluded from the calculation for all agricultural commodities since 
customs duties are not levied within the FTAs.  Thus , calculation of external reference price for wheat 
looked as follows: 
HS code Country Year Export 
volume, 
tonne Export 
value, 
US$ Export 
price, 
US$/tonne Export 
price, 
(KZT/tonne) 
1 2 3 4 5 6 
(5/4) 7 
1001901000 
Soft wheat and meslin seed All countries, 
except for CIS 2006 68,001 9,327.5 137 17,295 
2007 225,320 44,587 198 24,251 
2008 291,124 86,269 296 35,936 
*Average annual exchange  rate equals to:   
- KZT 126.09/US$ in 2006 
- KZT 122.55/US$ in 2007 
- KZT 121.27/US$ in 2008 
Taking into account concerns raised by some Wo rking Party Members, Kazakhstan re-calculated 
"external reference price" for the soft wheat using th e data on soft wheat other than seed for exports to 
all destinations, including CIS countries.  The "e xternal reference price" for other agricultural 
commodities was re-calculated in the same way based  on the data for exports to all countries.   WT/ACC/SPEC/KAZ/7/Add.3 
Page 16  
 
  Thus, the calculation of "external reference price" for the soft wheat other than seed looks as follows: 
HS code Country Year Export 
volume, 
tonne Export 
value, 
US$ Export 
price, 
US$/tonne Export 
price, 
(KZT/tonne) 
1 2 3 4 5 6 
(5/4) 7 
1001901000 
Other spelt, except for soft 
wheat and meslin seed All 
countries 2006 3,482,270 438,440 126 15,875 
2007 5,309,433 975,693 184 22,520 
2008 4,204,685 1,223,199 291 35,279 
 
2. Taking into account the existing WTO practices,  the fixed external reference price for wheat 
for future notifications would be th e simple fixed external reference price in 2006-2008, in particular - 
US$200 per tonne (KZT 24,588 per tonne).   
Updated DS tables with necessary amendments includ ing re-calculation of "external reference price" 
(Supporting Table DS:5) for all agricultural commodities based on the data for exports/imports of all 
destinations are available through document WT/ACC/SPEC/KAZ/6/Rev.5.   
- Supporting Table DS:9 
Question 34 There are two "Debt writing off" programmes with the same name.  It would clarify the 
reading of this Supporting Table if these two programmes were identified separately as, for 
example, Debt writing off (Ministry of Finance) a nd Debt writing off (Ministry of Agriculture).   
Answer 
Kazakhstan takes account of this comment and will make the necessary amendments in the table.   
Question 35 
While support through debt writing off is repor ted in 2006 and 2007, ze ro support is reported 
in 2008.  Does this mean that the authority to write off debts had been eliminated by 2008?  
Alternatively, did and does this authority still exist but it was just not used in 2008?   
Answer 
The competence to write off the debts of farmer s is under the competence of the Government.  
This programme is implemented on the basis of a Go vernment decision.  The authorized body writes 
off the accumulated debts in the amount specified by the Government Resolutions.  "Zero" in the table 
means that Government did not take a decision to write off the debts.   
Question 36 
"Revenue forgone due to decreasing coefficients  for transportation of agricultural cargoes by 
railway":  Do the reduced costs of transportation  for agricultural products on the main railway 
networks apply the same to both do mestic consumption and exports?   
Answer 
Under this programme, the Govern ment provides decreasing coefficien ts on tariffs for transportation 
of fruits and vegetables by main railw ay networks within the territory  of Kazakhstan a nd were applied  WT/ACC/SPEC/KAZ/7/Add.3 
 Page 17 
 
 
  only to fruits and vegetables for domestic consump tion.  The measure was taken by the Government 
against inflation.   
- Supporting Table ES:1 - Export Subsidies 
Question 37 We note that Kazakhstan did not provide export subsidies in the period 2006-2008.  
Our expectation remains that Kazakhstan will co mmit to binding export subsidies at zero upon 
accession.   
Answer 
Kazakhstan needs to use export subsidies due to its  landlocked geographical location, the vastness of 
territory, remoteness from major agricultural markets and high transportation costs, which 
significantly affected the competitive of  Kazakhstan's agricultural products.   
For instance, when delivering wheat to external markets, wheat is transited through the 
Russian Federation via railways.  The delivery cost of wheat to the Black Sea ports is equal to  
US$70-75 per tonne.  To the Baltic Sea the cost reaches US$80-85 per tonne.  High transportation 
costs represent a significant obstacle to comp etitive advantage of domestic wheat.   
Besides, Kazakhstan applies export subsidies only in exceptional cases.  For instance, in 2004 the 
Government of Kazakhstan rendere d a food aid to Georgia.  In accordance with the Government 
Resolution No. 758 of 12 July 2004, Kazakhsta n provided KZT 23.6 million (US$173,000) to cover 
the cost of purchase grain and its delivery to Tb ilisi (1,000 metric tonnes).  In 2005 Kazakhstan 
rendered a food aid to The Kyrgyz Republic.  In acc ordance with the Government Resolution No. 385 
of 23 April 2005, Kazakhstan provi ded KZT 18 million (US$135,000) to cover the cost of purchase of 
grain and its delivery to Bishke k station (1,000 metric tonnes).  In 2009 in accordance with the 
Government Resolution No. 1909 of 26 February  2009, Kazakhstan provided funds amounting to 
KZT 5 billion (US$34 million) for reimbursement of tr ansportation cost of grain by railways through 
the territory of the Russian Federation.   
Question 38 
Kazakhstan is correct in preparing to schedule NIL export subsidies. 
Answer 
Please see answer to Question 37 above.  
Question 39 
We note that in Supporting Table ES:1 there are no  export subsidies and we seek confirmation 
that this will continue.   
Answer 
Please see answer to Question 37 above.  WT/ACC/SPEC/KAZ/7/Add.3 
Page 18  
 
  Question 40 
We are pleased to see that Kazakhstan did no t report the use of export subsidies during 2006 
through 2008.  We firmly reiterate our position  - which is the same for all acceding countries - 
that Kazakhstan commit to binding all agricultura l export subsidies at zero upon accession, and 
we trust given their non-use, such a commitmen t will be an easy one for Kazakhstan to make. 
Answer 
Please see answer to Question 37 above. 
 
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