Singapore inks bilateral investment treaty with Kazakhstan

Investors can soon freely move capital in and out of their countries.

Singapore and Kazakhstan signed a bilateral investment treaty (BIT) in an effort to strengthen its economic ties by supporting investment flows between the two countries, an announcement revealed.

“Emerging markets such as Kazakhstan have strong potential for growth,” senior minister for trade and industry Koh Poh Koon said. “Kazakhstan’s rapidly improving economic reforms, highly literate workforce and growing urban middle class present opportunities for Singapore companies.”

The Kazakhstan-Singapore BIT will grant investors from both countries protection along the lines of non-discriminatory treatment compared to other foreign investments, freedom to transfer capital and returns in and out of the country, access to international arbitration for investment disputes and fair and equitable treatment based on customary international law.

As of 2016, Kazakhstan’s stock of foreign direct investment (FDI) in Singapore amounted to $2.5b, mainly in the financial and insurance services sector, the announcement noted. Singapore’s stock investment in Kazakhstan was $180m in the same year.

Kazakhstan is Singapore’s most significant economic partner amongst the five central Asian states which include Kyrgyzstan, Uzbekistan, Turkmenistan and Tajikistan.

Total bilateral trade in goods between Kazakhstan and Singapore reached $133.6m in 2017, with lubricating oils, unwrought tin and disc tapes and storage devices as the top exports to Kazakhstan. Top imports included petroleum oils and automatic data processing machines.

Singapore is also in the process of negotiating a free trade agreement with the Eurasian Economic Union (EAEU).