Creating an integrated ecosystem to attract investment is important task for Government of Kazakhstan
First Deputy Prime Minister Minister of Finance Alikhan Smailov noted that the execution of the instructions of Elbasy to attract investments in fixed capital and GDP at over 30% and create an integrated ecosystem to attract investments is a particularly important task for the Government of the country. At the same time, it is necessary to build effective mechanisms for attracting investments and review the entire infrastructure in this area
In this regard, as Smailov reported, a special working group was established to develop proposals. A detailed analysis of the existing mechanisms was made, and prospects for improving the efficiency of current activities were indicated.
A working group with the involvement of all interested state bodies and national companies has developed a new approach to attracting investment. The opinions of the parties were taken into account and a common position was formed. The Coordinating Council for Investment Attraction, chaired by the Prime Minister, will be the cornerstone of the new architecture, Smailov said.
The council will include deputies prime ministers, first heads of key ministries, the AIFC, national managing holdings, AtamekenNational Chamber of Entrepreneurs, Kazakhstan Investors Council Association, as well as Supreme Court, General Prosecutor’s Office and the National Security Committee.
The AIFC is identified as a single center for coordinating work on attracting investments and promoting the investment image of Kazakhstan. It will become a regional investment hub. The provision of services to investors on the principle of “one window” and the formation of a single pool of investment projects will be centralized. Kazakh Invest JSC will be transferred to the administration of the AIFC in trust. A unified information system for the formation and support of projects (the Project Factory) will be created, measures will be taken to further liberalize the visa and migration regime with the introduction of modern digital technologies. It is planned to expand the geography of direct flights of the city of Nur-Sultan with international financial centers.
Together with the Supreme Court and the General Prosecutor’s Office, proposals will be developed to further improve the investment climate, protect the rights of investors and ensure the rule of law.
Promotion of projects under the new architecture is planned to be carried out in four stages:
at the first stage, a centralized collection of all potential investment projects in the Regional Investment Hub (Project Factory) will be held;
at the second stage, processing and analysis of projects based on Kazakh Invest with the involvement of AIFC experts and consultants. Bringing projects into formats understandable for foreign investors;
the third stage involves the promotion of ready-made, packaged projects, using the existing channels of the AIFC and the infrastructure of the Ministry of Foreign Affairs;
at the fourth stage, contracts will be concluded on the basis of the Investment hub using the legal infrastructure of the AIFC.
Meanwhile, as Smailov noted, this architecture will be implemented in a short time. The presentation of the new architecture is planned in the framework of the Astana Economic Forum May 16, 2019.
The proposed measures will allow to consolidate and quickly form investment subsidies for investors and begin a comprehensive work to increase the volume of net direct investments. At one of the next meetings of the Government, a complete list of all necessary measures for the implementation of new approaches and the corresponding Roadmap will be submitted, Smailov said in conclusion.
Foreign Minister Atamkulov reported on the work done during the first quarter of 2019. Thus, work has begun on building an integrated ecosystem to attract investment. In each sectoral ministry, akimat and national companies, responsible deputy chief executive officers are identified, who are personally responsible for investment work and export.
Atamkulov informed that the heads of diplomatic missions were given specific tasks in the host country and performance indicators. 40 priority countries for investment have been identified. The focus will be on the United States, Germany and Japan.
At the same time, work is actively underway to automate the process of interaction of all interested organizations to accompany investors at all levels. Today, the Ministry of Foreign Affairs based on Kazakh Invest JSC has organized an information monitoring system (CRM) to support projects and investors online. This system accompanies the investor at the pre-investment, investment and post-investment stages. Thus, it is possible to pinpoint problem issues for each investment project online. Currently, the Ministry is monitoring 174 projects with foreign participation amounting to more than $ 40 billion, with the creation of about 41 thousand jobs. For each project, road maps have been developed and approved.
Investors at all dialogue platforms, such as the Council of Foreign Investors, the Council to Improve the Investment Climate, EUROBAK (European Business Association of Kazakhstan) have repeatedly raised questions of the rule of law, the volatility of the tenge rate, infrastructure and allocation of land, decriminalization of tax offenses, migration. On all the above issues, the Ministry of Foreign Affairs prepared a corresponding Concept and Draft Law, and has already sent it to the Ministry of National Economy.
In addition, the Minister of Foreign Affairs pointed out the need to revise and modernize the current legislation of Kazakhstan in order to maintain its position at the regional level.
We fully support the proposals to create an ecosystem to attract investments around the Astana International Financial Center, said Atamkulov.
Governor of the Astana International Financial Center Kairat Kelimbetov, in his report noted that at the AIFC fully supports the Government’s initiative to establish a Coordination Council and a Regional Investment Hub.
We believe that the emerging investment vertical will bring work with foreign capital to a new level, said the AIFC Governor.
The AIFC administration will become the working body of the Coordination Council, the main functions of which will be the organization of the work of the ombudsman office the prime minister, preparation of documents for investment projects, development of financial standards and models. The jurisdiction of the AIFC consists of the Financial Market Regulatory Committee, the AIFC Court and the International Arbitration Center, based on the principles of English common law. Financial infrastructure includes the Direct Investment Fund and the AIFC Stock Exchange.
An important part of this vertical will be the participation of financial institutions such as Development Bank Kazyna Capital Management. As Kelimbetov noted, a similar vertical can be built at the regional level.
Minister of Justice Marat Beketaev explained the advantages of the special legal regime of the AIFC. According to the Constitution in the city of Nur-Sultan a special legal regime is established in the financial sphere. Constitutional law was also passed. Investor activity in the International Financial Center is governed by English law. The official language is English. An independent court has been created on the territory of the AIFC, the justice in which will be carried out by English judges.
All these measures guarantee respect for property rights and effective administration of justice. This is an important signal for foreign investors who can make direct investments and implement large-scale projects, which will ensure further economic growth, the minister stressed.
In Kazakhstan, human capital is being formed that is capable of ensuring the work of investors. Lawyers of international level, fluent in English and educated at the world’s best universities, have been trained.
The ongoing work to strengthen justice is reflected in international rankings. In the International Index of Rule of Law, Kazakhstan ranks 65th among 126 countries, showing an increase of 10 points over 7 years.
Investors should feel that Kazakhstan is a reliable partner who will provide a stable and comfortable environment for business. Such a priority is designated by the First President Elbasy, Beketaev summarized.
During the Government meeting, Chair of the Kazakhstan Foreign Investors Association Agris Preimanis, shared his opinion on the new measures to attract investments. As he noted, Kazakhstan has achieved a lot since independence, working closely with the Foreign Investors Council and international experts. According to him, the new structure will serve as an impetus to increase the flow of direct investment.
We are ready to work through the new approach regulations and actively work in the new structure in the future, which will not only attract investments, but also better understand the system challenges that exist in the economy, said Preimanis.
In addition, during the meeting, akims of the East Kazakhstan region Danyial Akhmetov, Almaty Bauyrzhan Baibek, Nur-Sultan Bakhyt Sultanov were heard.
Source: The Prime Minister of Kazakhstan