During the first 9 months of this year, the total investment in fixed capital of Kazakhstan increased by 21.6% and amounted to 7.5 trillion tenge. This was announced by the Minister for Investment and Development Zhenis Kasymbek at a meeting of the Government of Kazakhstan. "Kazakhstan is a leader in attracting investments in Central Asia. The share of the republic is about 70 percent. For the first nine months of this year, the total investment in fixed capital increased by 21.6 percent and amounted to 7.5 trillion tenge.
An increase in the mining industry by 41.4%, in construction by 37.1%, in the manufacturing industry by 26.4%," Kasymbek reported. He noted that at the republican level, the largest share of investments falls on such regions as the Atyrau region accounting for 35.8%, Astana for 9.2%, and Almaty for 6.5%. "The share of private funds in the volume of investments in fixed capital for the first 9 months of 2018 was 73.1 percent or 5.5 trillion tenge. The largest growth is in the following regions: Zhambyl by 20.9 percent, Mangistau by 20.6 percent, Akmola by 17.2 percent, Atyrau by 16 percent, Almaty by 9.6 percent, East Kazakhstan by 7.4 percent, Karaganda by 7.2 percent, Turkestan by 3.5 percent, Pavlodar by 1.9 percent, West Kazakhstan by 0.3 percent, Kostanay by 0.04 percent, Almaty by 1.2 percent,", added Kasymbek.
However, in some industries, according to the minister, there has been a decline in investment. "At the same time, a decrease is observed in the following regions: Astana by 1.9 percent, Kyzylorda by 3.6 percent, Aktobe by 6.3 percent, North Kazakhstan by 9.9 percent, Shymkent by 34, 4 percent," he continued. In addition, in the first half of 2018, according to the Minister of Investment and Development of the Republic of Kazakhstan, the gross inflow of foreign direct investment grew by 15.4% and amounted to 12.3 billion US dollar.
"Growth is shown in such industries as mining industry with 6.7 billion dollar (an increase of 13.6%), transport with 393.3 million dollar (an increase of 21.7%), trade with 2 billion tenge (an increase of 37, 3%), financial and insurance activities with 359.5 million dollar (1.7 times increase), information and communications with 124.2 million dollars (5.7 times),” said Kasymbek.
Five systemic problems in attracting investments in the regions were named by the minister.
"The first is the issue of allocation of land plots. Almost every region has investment projects for which assistance is needed in obtaining land plots. The second is that a number of projects is hampered by the long-term solution of the issue of engineering infrastructure. The third is the issues of gas supply and gas pricing for six projects worth $ 5.1 billion," Kasymbek said. He noted that in order to address the issue of gas pricing for projects that use gas as raw materials, it is necessary to make changes in the legislation on gas and gas supply and in relevant by-laws. The fourth is a number of issues on the activities of the FEZ.
"For example, the incomplete infrastructure (FEZ Pavlodar, Astana-New Town, NINT), project fill rate (SEZ Sea Port Aktau, Saryarka, Khorgos-Eastern Gate), the efficiency of management companies (FEZ PIT, Seaport Aktau),” he continued. Currently, according to Kasymbek, there is a bill in the Parliament aimed at solving a number of fundamental tasks. The fifth is the introduction of new project financing instruments. According to the minister, the principle of direct investment funds involves the search for promising projects that need to be financed, attracting co-investors, and further assistance to promote business.
Kazakhstan studies the issue of establishment of the Direct Investment Fund, Kassymbek said at the Government's weekly briefing. In his words, investment preferences and infrastructure support are not always enough for attracting investments. "We are presently considering the possibility of establishment of the Direct Investment Fund," he added.
Zhenis Kassymbek said the Fund's activity is supposed to be focused on attraction of special-purpose and pinpoint investments to promising and high-demand sectors.
The Direct Investment Funds are functioning today in many countries. They proved to be an effective tool of searching for promising projects, attraction of co-investors (private, corporate and foreign ones) as well for further promotion of business.
By Inga Selezneva for the Kazakhstanskaya Pravda, additional reporting by Kazinform.
