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Wednesday, December 2nd, 2020

EAEU countries to be able to voluntarily coordinate specific subsidies

by February 7, 2018 General

The Majilis of the Parliament of the Republic of Kazakhstan has approved the ratification of the Agreement providing for the right of the states of the Eurasian Economic Union to voluntarily coordinate specific subsidies with the Eurasian Economic Commission.

The Commission will make decisions on granting specific subsidies for industrial goods in accordance with this document.

The agreement provides for 15 criteria for the admissibility of subsidies. For a positive decision, it is necessary to meet at least one of them. Including if the subsidy is minor – 100 thousand dollars to one recipient (enterprise). The manufacturing must be joint, and the product itself must be produced on the territory of the Union in insufficient quantities. Among the criteria are also novelty for the region, innovation, location of the enterprise in disadvantaged regions. At the same time, subsidies are intended for beginners who are in a crisis situation, adapting to the EAEU standards, affected by industrial emergency incidents.

During the plenary session of the Chamber, Minister of National Economy Timur Suleimenov explained which calculations led to this amount � 100 thousand USD.

We came to 100 thousand USD based on the experience of the European Union. In 2001, the EU adopted a similar decision for its members, where they used the standard – 200 thousand euros. Proceeding from the fact that according to the purchasing power parity our economy in terms of GDP per capita lags behind, unfortunately, the criterion of 100 thousand USD is adopted as framework. Secondly, we took into account those subsidy rates that exist in our country, in particular, last year the program “Productive Employment and Mass Entrepreneurship” was launched, which provides entrepreneurs with loans of up to 18-19 million tenge. Accordingly, to ensure that these loans are not considered specific, and so that our entrepreneurs would not have to write to us, and so that we would not have to coordinate with the Commission or other states, such a high bar was set. These loans can be allocated painlessly, without coordination with the Eurasian Commission, � the Minister explained.

Source: Government of the Republic of Kazakhstan