Baiterek Holding Increased Activity, Saw Major Growth in 2013

BaiterekASTANA – Last year, the newly established, state-owned Baiterek National Holding, through its 10 constituent companies, accumulated four times more in profits than was expected. It is also expected to show strong growth this year, its director announced at the Feb. 6 expanded meeting of the Ministry of Industry and New Technologies and the holding.

At a gathering which also included Prime Minister Serik Akhmetov and Deputy Prime Minister and Minister of Industry and New Technologies Asset Issekeshev, Chairman of the Baiterek Holding Kuandyk Bishimbayev presented the main results of operations for 2013 and outlined plans for the coming year.

By the end of 2013, the planned total net income of its subsidiaries is expected to reach 40 billion tenge (US$257 million). This is 415 percent more than expected at the time of its creation (6.5 billion tenge or US$41.7 million) and 135 percent more than in 2012.

In 2013, the holding took a number of measures to increase activity among its subsidiaries. At the Development Bank of Kazakhstan, it cleared out toxic assets and ended 35 problem projects. It also began a support programme for the State Programme of Accelerated Industrial-Innovative Development (SPAIID), financing second-tier banks. Under the programme, 177 projects will be funded, creating more than 15,000 jobs. The bank also approved financing for 10 projects worth more than $1.3 billion and brought into production seven projects worth $242 million.

Another subsidiary, Kazyna Capital Management invested in three new projects totalling $31 million in 2013.

The National Agency for Technological Development signed a memorandum with the Islamic Corporation to develop the private sector and create the Central Asia Renewable Energy Fund.

The Housing Construction Savings Bank of Kazakhstan signed more than 100,000 contracts on housing savings and housing loans in the amount of 61.2 billion tenge (US$393.4 million). Under the Affordable Housing 2020 programme, it commissioned more than 300,000 square metres of housing in more than 4,000 apartments. For housing for young families, it commissioned more than 100,000 square metres of housing in 2,031 apartments.

The Damu Entrepreneurship Development Fund, another subsidiary, supported 3,275 projects, with 1,044 entrepreneurs getting support in the form of subsidies. Subsidies granted reached 27.5 billion tenge (US$176.8 million), 40 percent more than in 2012, and 148 entrepreneurs received support in the form of guarantees.

In order to attract investment to the industrial and innovative development of the country, the Baiterek Holding will implement three projects in 2014: creating a centre to support public-private partnerships, establishing a fund for infrastructure projects and establishing a fund for startups.

Next year, the Development Bank of Kazakhstan will have more than $700 million to provide for investment projects. It is considering projects in Shymkent, at the Aktau port, in Karaganda and rail and communications projects. The Kazakhstan Investment Fund will consider investing in projects in concrete products, cement, metal, processing of fish products, leather processing and other sectors.

To support small and medium-sized businesses, the state plans to provide support to more than 80,000 such enterprises, or more than 10 percent of the current market. Competence centres for small businesses will cover 209 cities and regions of Kazakhstan.

To support innovation, some existing industrial parks will be reorganised as technology business incubators and co-working centres. Support of $1.8 billion is planned for 120 innovative projects.

The Housing Construction Savings Bank of Kazakhstan plans to increase the share of participants in housing savings to 5 percent of the economically active population. Through 2020, the bank plans to commission 4.5 million square metres of housing, including 1.5 million for young families.

In 2014, the Kazakhstan Mortgage Company plans to launch 171,000 square meters of rental housing, including 155,000 square metres through Affordable Housing 2020. Credit rental housing is planned, as is a programme of rent-to-own properties.

The Baiterek Holding includes 10 companies participating in the SPAIID, Affordable Housing 2020 and the Business Road Map 2020. It was created last May by presidential decree with the role of providing long-term, cheap money to support economic development.

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