Council of Foreign Investors

On November 18, a meeting of the Council of Foreign Investors was held under the chairmanship of the President of Kazakhstan Kassym-Jomart Tokayev.

This year, according to the updated forecast, direct foreign investments may fall by 40 percent. In this regard, the members of the Council of Foreign Investors are faced with the task of taking all possible measures to minimize the negative impact of the pandemic on the economy and investment climate. This was stated by the Head of State during his speech.

The President announced a number of initiatives to strengthen the industry.

"We have developed a Strategic Investment Agreement. This tool will ensure guaranteed stability of legislative conditions on the part of the state for the entire period of validity. That is, up to 25 years from the date of signing. This Agreement will provide a whole package of benefits and preferences. At that, this Agreement will be very flexible. The level of support depends on the amount of investment and priority of the project."
 
According to Kassym-Jomart Tokayev, Kazakhstan is developing a high-quality new regulatory system. All control and supervision, licensing and other regulatory instruments will be subject to a large-scale audit.

"We call this project "Regulation from scratch". To do this, the regulatory guillotine tool will be used, which provides for the unconditional exclusion of unreasonable and outdated requirements and standards. In order to reduce administrative pressure, an integrated database is being developed for independent verification of its counterparties. This will reduce the burden of tax administration."

New Environmental code will also provide good preferences for investors: "The main innovations are to encourage the introduction of the best available technologies. Enterprises that have implemented them will be exempt from the emission fee," the President said.

According to him, it is planned to attract at least KZT 500 bln. to IT sector within five years. The investment capital of Kazakhstan is also intended to be directed to the development of pharmaceuticals, education and labor market.

President of the European Bank for Reconstruction and Development Odile Renaud-Basso noted that over the past 30 years, Kazakhstan has achieved great success and has become a model of reform and economic development. "Mr. President, you have introduced the country to a new era, which is based on the important achievements of the First President, Mr. Nazarbayev. I look forward to coming to Kazakhstan and meeting you in person," he said during an online meeting.

The Asian Development Bank is also an important partner of Kazakhstan. ADB Vice President Ashok Lavas informed about the provision of USD 1 bln. in June in the form of an anti-crisis loan to support health care and social issues. "It is necessary to develop reliable and diversified long-term financing in local currency for investors. This could deepen local capital markets," he commented.

A package of state support measures for businesses and population also helped mitigate the negative impact of the pandemic. Kazakhstan has allocated about KZT 6 tln. for this purpose. According to the estimates of Eurasian Development Bank, it will compensate for about 2-3 percent of GDP losses in the current year. Nikolay Podguzov, Chairman of EDB Board, suggested that "thanks to the Government's measures, the economy of Kazakhstan will reach the pre-crisis level in 2021".