BAKU, Azerbaijan, May 3. The cooperation agreement signed between the Development Bank of Kazakhstan (DBK) and the Czech EGAP (Export Guarantee and Insurance Corporation) should serve as a supporting tool for developing mutual business between the Czech Republic and Kazakhstan, Jan Černý, Spokesperson of the EGAP, told Trend.
"This agreement is a tool enabling more effective mitigation of risks related to business transactions between these two countries, especially in the case of capital goods transactions," he said.
According to him, in many cases, exports from the Czech Republic are accompanied by risks mainly on a corporate side resulting in a significantly higher premium rate covering export financing as it would be in the case of DBK involvement.
"The deal, on the other hand, makes transactions to Kazakhstan more viable and provides more accessible technology from the Czech Republic for Kazakh companies and producers," Jan Černý said.
Since the Czech Republic has a solid background in the fields of technology in machinery, transportation technologies, the power sector, construction, and various products including production machines for numerous industries from mining over textile to agriculture, this deal with EGAP will let Kazakhstan take advantage of this Czech experience at lower prices.
In addition, the EGAP representative said that since DBK knows the Kazakh market well, this agreement may assist the Czech Republic to minimize risks concerning customer satisfaction.
"Technology imported from the Czech Republic opens new opportunities for Kazakh companies to generate products with higher added value and generally opens the exchange of goods among both countries as well as supports new exports to third territories. Czech machinery, technology, and transportation products have a long-term tradition of high quality for affordable prices and it is also an aspect that may be taken into consideration besides the effective cooperation of EGAP and DBK," he said.
Concerning the cooperation with Kazakh entities EGAP has signed also a Memorandum of Understanding with the Kazakh export credit agency – “KazakhExport”, to develop cooperation in mutual business activities.
According to the EGAP spokesperson, along with Kazakhstan, EGAP also operates in Uzbekistan and Azerbaijan. With Azerbaijan, as he noted, the EGAP had the largest transaction in insurance of financing of the railway infrastructure project.
Following the Kazakh-Czech Business Forum held in Astana on April 25, major Czech companies signed agreements and memoranda with Kazakh companies and the government. Among those companies was also EGAP.