Business news in brief

At the seventh Astana Economic Forum (AEF) on May 21, the fifth international investment forum Astana Invest 2014 will be held. The Astana Invest Forum works to attract investment to Astana, to involve all participants in the discussion of current issues of the city’s investment development, as well as to establish international cooperation and to promote Astana’s image. The forum demonstrates investment opportunities in Astana and aims to further stimulate domestic and foreign investment flow to the city’s economy. About 400 participants from different government agencies, national companies, development and financial institutions, international investment companies and foreign and domestic business structures are to attend the forum. In addition to the capital’s investment potential, Astana’s inclusion as one of the world’s top smart cities and preparations for EXPO 2017 will be discussed.

The government of Kazakhstan has recently prepared a comprehensive package of incentives for foreign investors. Deputy Prime Minister and Minister of Industry and New Technologies Asset Issekeshev said the government envisions a two-part plan. The first part includes general issues such as removing barriers, including visas and similar issues, and other incentives for attracting top companies. The second part of the plan is what Issekeshev called “a definite plan of attracting investors” that sets a list of priorities, including sectors of Kazakhstan’s economy and a list of transnational companies of particular interest. Minister of Economy and Budget Planning Yerbolat Dossayev said that a list of 10 countries identified as the biggest investors in Kazakhstan had been put together. “The list is needed to ‘improve the nature of negotiations,’” he said. It now includes Organisation for Economic Cooperation and Development countries, but Dossayev promised that the list would be expanded later. Dossayev, speaking about the first part of the package, said that a visa-free regime would be put in place for citizens of the most developed countries, letting them enter Kazakhstan for 90 days without a visa. Special investor visas would be issued to top management of structural units of foreign companies. Establishing an investment ombudsman to guarantee investors’ rights was also highlighted. On the second part of the plan, Dossayev said that the government was willing to subsidise a portion of investors’ costs, which would include the costs of hydrocarbons and transportation expenses. Additional measures of governmental support offered to investors include amending mechanisms for awarding contracts, compensating 30 percent of capital expenses after the beginning of production and ten years of exemption from corporate income tax.

“We confirm that no agency or any state body can make a decision infringing upon the interests of business within the Customs Union. If such a thing takes place the government of the country can issue a veto. This mechanism is well developed now,” First Deputy Minister of Industry and New Technologies Albert Rau said at a May 5 Central Communications Service (CCS) briefing. Rau noted that there were some issues in the construction sphere, but a formula accepted by all sides had been found. “Technical regulation is a very important mechanism for reducing barriers, meaning that when we have common technical regulations and a common accredited laboratory with its test base, nothing will stop Kazakh products from going to the markets of partner countries. The technical regulation should help this,” Rau said. Creating a common energy market is not critical for Kazakhstan. “By 2019, we will reach a point where we can create the common energy market. In my opinion, it will be of great concern for us. If we have any additional energy power, we could even sell some,” he noted. However, Rau said there are some reasons why the market cannot be created now. According to him, Belarus is a 100 percent state-vertical company, Russia has an altered type of the market and Kazakhstan is also different.

 

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