Shipping from UAE to Kyrgyzstan
As the world evolves, hardly can a country be so independent that it doesn’t open its doors to international or bilateral trade. This has caused an increase in trade activity across the borders of nations, which is further facilitated by the effective transport of goods internationally.
For this article, we are focusing on trade between the UAE and Kyrgyzstan. So, we will break down useful information on this trade lane and bring you top solutions on freight forwarding services for Kyrgyzstan.
Understanding this trade lane will bring to light all that is involved in moving cargo to Kyrgyzstan, the opportunities in this lane, and how to get the best freight solutions for smooth operations.
Overview of Trade Lane Between UAE and Kyrgyzstan
Let’s track Kyrgyzstan exports to UAE in the last decade:
UAE’s trade with Kyrgyzstan is on a positive trend as both nations are strengthening trade relationships with developmental meetings, agreements, and lenient trade policies. This has positively influenced traders’ activities in this lane in the past years.
Thriving on the smooth trade relationship, UAE made total export of 657 million USD to Kyrgyzstan. On the other hand, Kyrgyzstan made a total export of 100 million USD in 2022. UAE’s major exported products to Kyrgyzstan were electronics, tobacco, and vehicles; while Kyrgyzstan’s exports were gold, electronics, and machinery.
The key contributing industries in this trade lane include;
What better way to do justice to this subject matter than having a quality breakdown of the UAE and Kyrgyzstan economies. Their economy is a key indicator of the influence made by trading activities in these nations. It also shows areas of potential growth and investor activities.
We can’t talk about a thriving economy in the Middle East without mentioning the UAE. The UAE ranks as fifth largest economy in the Middle East. It’s valid that the oil sector is the nation’s biggest strength, however, development has touched other sectors which has resulted in immense growth and output. The UAE now boasts a well-grounded and diversified economy.
According to Statista, the UAE GDP for 2022 hit $507 billion and it’s projected to hit $639 billion by 2028. Comparing with the GDP in 2021 which was $415 billion, it shows a significant increase and upward trend in trades and profit.
It’s an undeniable fact that UAE runs a diversified economy, which has reduced its dependence on the oil sector. However, the oil and gas sector are still the leading industry in the UAE, but other industries have grown to be key contributors to the economy as well, including
- Logistics and transportation
The UAE is a top exporter of crude oil, food materials, vehicles, machine parts, precious metals, copper, and fabrics.
Major Trading Partners
The list of UAE’s trading partners is a pretty long one. However, we can streamline the list and mention the front runners that includes China, the USA, Turkey, Iran, Vietnam, Japan, Oman, and the United Kingdom.
You’ll find Kyrgyzstan in the Central region of Asia. It’s not up to par with the largest economies in Asia just yet, but have been making progress and positive strides. The Kyrgyzstan economy is largely dependent on Agriculture although other sectors are fast rising to the occasion.
Kyrgyzstan’s GDP is currently at $8.7 billion with a GDP per capita of $1,327. The growth of the economy as reflected in the GDP hasn’t been so stable due to the little unrest that occurred some years ago. This was due to the parliamentary elections in 2020, where there was intense protests and clashes with the police. The citizens were unhappy with the corruption practices in the elections.
Kyrgyzstan’s market size is relatively small with a population of 6.8 million. However, the labor force is more than half of the population, which indicates a potential productivity increase.
Why Choose for Investment?
While we see Kyrgyzstan as a relatively small economy, it has been an attractive ground for investors- the records validate this fact. With an annual Foreign Direct Investment of $0.2 billion, it shows that businesses see Kyrgyzstan as a profitable ground.
- Investing in Kyrgyzstan can give you access to larger markets as it is bordered by China to the east, Uzbekistan to the west, Kazakhstan to the north, and Tajikistan to the south.
- There are promising sectors with grounds for immense growth. These include mining, agriculture, textile, and steel.
- Kyrgyzstan is a business-minded nation as its doors are open to local and foreign businesses. They are ranked 80 for doing business and ranked 42 for starting businesses in Asia.
The key sectors contributing to the country’s GDP are manufacturing, services, and agriculture. The services sector, which includes sub-sectors like trade, logistics, and transport is the largest contributor with over 50%. Manufacturing contributes 21%, agriculture hits 17%, and mining makes 9%.
Top Exports and Imports
Kyrgyzstan’s top exports are gold, fruits and nuts, textile, wool, leather, vehicles, uranium, and nonelectric engines.
Its imports broadcasting equipment, petroleum gas, cars, wheat, refined petroleum, trucks, telecommunication equipment, and rice.
Major Trading Partners
The nation’s major trading partners are Russia, China, Turkey, Kazakhstan, and Uzbekistan. China is still the largest trading partner of Kyrgyzstan.
Shipping Route and Mode of Transportation
When we talk about the UAE to Kyrgyzstan, it encompasses the economy, opportunities, and shipping to Kyrgyzstan. It’s a full package, but now we want to discuss the shipping route and transport modes available on this trade lane.
Have in mind that there are different cities in UAE and Kyrgyzstan. So, moving cargo between UAE and Kyrgyzstan can be between any of the cities. As a result, there are different routes or corridors that the cargo will pass through. For example, shipping from Dubai to Bishkek may not be the same route as shipping from Abu Dhabi to Bishkek.
Let’s look into the details of the corridors
This corridor is land-based cutting across several Asian countries. It involves moving cargo via rail or truck to Uzbekistan. Then, you can move cargo from Uzbekistan to Kyrgyzstan via truck or train.
The east corridor is pretty long as it involves sea, road, and rail transport. The movement begins from the Al Khalifa port in Abu Dhabi as cargo is shipped to Oman. From Oman, the cargo is transported by road to the Caspian Sea port of Aktau in Kazakhstan. This will involve passing through major countries such as Iran, Iraq, Saudi Arabia, and Kuwait.
This is a typical corridor for shipping from Dubai to Bishkek as the journey begins from the Jebel Ali port in Dubai. Cargo is transported from Jebel Ali to Karachi via sea. From Karachi, it moves by road to another Pakistani town called Chaman. From Chaman, the cargo is moved via train to Kandahar in Afghanistan.
Cargo is moved from Kandahar to Kabul by road, then from Kabul moves to Termez in Uzbekistan by rail. Then from Termez, cargo will be transported to Bishkek the capital city of Kyrgyzstan.
This is the major mode of transport from UAE to Kyrgyzstan. Most ideal for very large volumes of cargo and can handle lesser volumes in the case of Less than Container Load (LCL).
Major Ports in UAE and Kyrgyzstan
There are four active and equipped ports in UAE.
- Port of Jebel Ali, which you’ll find in Dubai.
- Port of Sharjah, which is located in Sharjah.
- Port of Fujairah, which is located in Fujairah.
- Port of Khalifa, which is located in UAE’s capital city (Abu Dhabi).
Kyrgyzstan does not have a seaport since it is a landlocked country. However, it makes use of alternative ports in neighboring countries. Due to proximity, one can access Kyrgyzstan through these neighboring ports.
- Port of Aktau (Kazakhstan)
- Port of Baku (Azerbaijan)
- Port of Poti (Georgia)
- Port of Bandar Abass (Iran)
UAE and Kyrgyzstan are a bit far apart and since there are no major ports in Kyrgyzstan, there will be lots of stops on the way. So, the estimated transit time is 10 to 20 days.
This is pretty much the most straightforward transport mode for this trade lane. Since both countries have capable airports, it’s going to be a direct journey mode without stopovers.
Airports in UAE and Kyrgyzstan
Airports in UAE include:
- Sharjah International Airport
- Abu Dhabi International Airport
- Fujairah International Airport
- Dubai International Airport
- Al Maktoum International Airport
- Ras Al Khaimah International Airport
Airports in Kyrgyzstan include:
- Osh International Airport (Osh)
- Manas International Airport (Bishkek)
- Jalal- Abad International Airport (Jalal- Abad)
- Issyk-Kul International Airport (Tamchy)
- Batken Airport (Batken)
Airlines that Operate the Route
- Flydubai Cargo
- Air Arabia Cargo
- Emirate SkyCargo
- Turkish Cargo
- Etihad Cargo
Air freight is undoubtedly fast and needs a few hours to a few days. On the other hand, the speed of transport can depend on the air freight package such as expedited or standard shipping. Expedited shipping is very fast and can take 1 to 2 days. Standard shipping takes a long time, between 3-7 days.
Customs and Regulations
Customs and regulation are great determinants of success in cross-border trade. They are a set of rules, modalities, and requirements that monitor the entry and exit of goods in a nation.
UAE Customs and Regulations
Let’s have a look at the customs and regulations peculiar to the United Arab Emirates. This will include rules and documentation.
Documentation Required for Imports and Exports
- Import License – May be needed in the case of imports for special goods.
- Export License – May be needed as specified with special goods. Showing that the exporter is licensed for such an operation.
- Certificate of Conformity – Certifies that the goods exported or imported meet the standards.
- Health Certificate – This document is unique to pharmaceutical and food products showing that they meet health and safety standards.
- Commercial Invoice- This will show the price of the goods, payment methods, and terms of sale.
- Bill of lading – This document is prepared by the shipping company stating that the goods have been loaded and are ready for shipment.
- Packing List – The packing list gives a description of the goods such as quantity, dimensions, characteristics, and weight.
- Custom Declaration – This document is used for determining the custom duties as it states the goods, their quantity, and value.
- Insurance Certificate – This document shows that the goods exported or imported have been insured.
Following are some of the import regulations specified by UAE’s authority:
- Comply with regulations on restricted items
- Register with the UAE customs authorities
- Pay import duties and taxes
- Adhere strictly to UAE packaging regulations
- Obtain a trade license
Following are the export regulations specified by UAE’s authority:
- Obtain an export permit
- Acquire relevant custom documentation for imports
- Obey the intellectual property law
- Adhere to the regulations regarding embargoed goods
Tariffs and Taxes
- Excise Tax- The rate varies, and it is placed on goods thought to be harmful.
- Custom Fees – These are not constant as they are placed on a few goods, for example, luxury goods.
- Value Added Tax – UAE places a VAT of 5% on goods. However, some goods are exempted from VAT such as fruits, vegetables, and health care equipment.
Kyrgyzstan Customs and Regulation
For successful trade to Kyrgyzstan, here are some customs regulations to follow:
Documentation for Imports and Exports
- Commercial invoice
- Bill of lading
- Packing list
- Custom declaration
- Purchase order (for imports)
- Certificate of origin
- Import license
- Export license
Import and Export Regulation
Following are the import and export regulations to follow for trade in Kyrgyzstan:
- Custom duties and taxes must be paid on goods except for some special goods as stipulated by the authorities.
- No shipping of restricted and prohibited goods.
- Complete documentation is compulsory.
Tariff and Taxes
- Custom duty on goods depends on the type of goods. However, customs duties do not exceed 20%.
- 12% Value Added Tax on all goods.
Trade Opportunities and Challenges
A good look at the economies of this trade lane gives hints at the prospects and opportunities you can explore. So, we are going to dive into these opportunities and also look at the challenges in this lane.
Key Industries with Growth Potential
- Agriculture: Kyrgyzstan embraces agriculture to a great extent. Coupled with the attention and zeal, large portions of its land are arable. There are government incentives for this sector and the cost of labor is affordable.
- Metallurgy: This sector already produces a good volume of exports and it’s believed to have good growth potential. There are resources such as silver, gold, copper, uranium, and coal to explore.
- Construction: The population growth and entry of migrants and investors have boosted the real estate market. Other structures and infrastructures have also boosted the need for construction materials. So, it’s a viable sector.
Trade Agreements Between UAE and Kyrgyzstan
UAE has a cordial relationship with Kyrgyzstan, and this has triggered a good volume of trade in the past years. There have been meetings a number of times between the officials and governing crew of both nations that clearly stated their desire to strengthen trade relationships.
Several Memorandums of Understanding (MoUs) have been signed by both UAE and Kyrgyzstan. They covered the area of investments, trade, and tourism.
Emerging Markets in Kyrgyzstan
There are numerous emerging markets in Kyrgyzstan, as the country itself is still emerging. Every sector of its economy is rising to be a market that people are willing to explore. This has attracted foreign investors from all across the world. Some of the emerging markets are;
- The agricultural sector
- Technology sector
Language and Cultural Barrier
The UAE and Kyrgyzstan are on different terms regarding language and culture. The UAE speaks Arabic and Kyrgyzstan speaks Kyrgyz or Russian. However, in business terms, the UAE uses the English language, but Kyrgyzstan has difficulty with the English language. So, this is a concern as it makes communication difficult.
On the part of the culture, both nations are Muslims, but UAE imbibes strict values and rules compared to Kyrgyzstan.
This tends to disrupt economic flow and trade activities. When there is unrest or issues in a nation, it scares investors and kills productivity. With Kyrgyzstan having some governmental issues in the past, its political stability has been questioned. However, it looks like they are finding a way past this ordeal.
This involves structures needed to run the different sectors of the economy. For example, road networks facilitate the movement of goods which in turn boosts trade. There are a few of these infrastructures lacking in Kyrgyzstan. However, the government is working to establish the necessary infrastructure for the good of the nation’s economy.
Value Addition from Al Sharqi
Taking advantage of this trade lane shouldn’t be as difficult as previous times. We can make the whole process streamlined, seamless, and better. Al Sharqi offers efficient cargo service to Bishkek, Kyrgyzstan.
Here’s what we will do:
- Ocean Freight: We offer Full Container Load and Less than Container Load just to suit your needs. We will move your cargo from Kyrgyzstan to its destination via China, Iran, or any other corridor that suits you best.
- Air Freight: Al Sharqi offers several air freight solutions including air cargo charter service to Kyrgyzstan, Bishkek. We will move your cargo to any city in Kyrgyzstan as soon as possible.
Get more information from us now!
UAE – Kyrgyzstan trade lane is beneficial to the nations involved as well as brands or businesses. With an impressive economy and sectors with growth potential, it’s a viable ground to explore. Take advantage of the key industries- agriculture, trade, manufacturing, construction, and tourism as they hold potential for growth and development.
From records, the top 3 include Kazakhstan, taking the first place, Russia, coming second, and Uzbekistan, coming third. 2020 records show that the listed partners made a trading volume of over 70%.
The trade volume is growing as it was recorded to hit $84 million in 2020. Both nations are committed to seeing the trade relationship blossom and there are a lot of work put in place.
Yes, in 2012, UAE and Kyrgyzstan signed a trade agreement that covered investments, tariffs and taxes, trade facilitation, and systems.
The main goods are broadcasting equipment, home appliances, food materials, and textiles. The traded goods should increase in the near future.
There are different routes, that is the west, east, and south. These routes involve a multi-modal transport system where cargo moves by sea, rails, air, and roads. Moving from UAE to Kyrgyzstan via road, rail or sea will mean passing through several countries such as Saudi Arabia, Kazakhstan, Iran, China, Uzbekistan etc.
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