ASTANA – The Special Economic Zone “Park of Innovative Technologies” (SEZ PIT) was the Asia-Pacific category winner in fDi’s Global Free Zones of the Year 2017. Experts noted the investors enjoy preferential tax rates, including zero-percent property, corporate income, social and land taxes. The international programmes for domestic and foreign start-ups based on venture financing were also specifically recognised.
The Astana Times interviewed Autonomous Cluster Fund CEO Sanzhar Kettebekov to learn about the start-up acceleration, innovative solutions for subsoil users and Industry 4.0 laboratory.
Tech Garden’s activities
“The entry to the most prestigious free zone ranking proves that measures implemented by the government and the fund in this area are effective and trustworthy,” said Kettebekov.
The Autonomous Cluster Fund, a managing company of SEZ PIT and Tech Garden Innovative Cluster, was established in 2015.
“A new development strategy for local companies has been recently developed and it takes into account new requirements to target external markets. Currently PIT has 134 companies and 1/3 are new comers who joined free zone under our guidance and leadership,” he added.
The total revenue of the companies has doubled since 2015 to 132.6 billion tenge (US$398 million).
At present, the technopark has 66 members working remotely according to the extraterritoriality principle, 46 of which are located in different areas of Almaty.
“With the help of government we opened IT quarter in Almaty. The main goal of IT quarter is to unite IT companies and innovative startups in order to have a synergistic effect of joint work. By the end of this year 10 companies will join IT quarter, and next year up to 40 companies will join us as well,” he said.
Start-up acceleration initiatives
The Startup Kazakhstan international acceleration programme has also been launched, aimed at developing domestic and attracting foreign start-ups to the country.
Start-ups at the Tech Garden office will participate in the acceleration programme in Almaty and the Silicon Valley. The investment in start-ups will be up to US$100,000.
“Overall, we plan to finance around 500 innovative startups by 2020 year. The key object is to incubate at least 50 high-tech and export-oriented companies. While this model of attracting startups to the market is a new experience for us it is widely used in developed countries. Foreign startups are officially entering Kazakhstan and hiring local work force that will lead to further development of entrepreneurial culture and exchange of knowledge and experience. Our main focus is still on support and developing Kazakhstan startups. Foreign startups are helping to achieve this,” noted Kettebekov.
He stressed the importance of establishing effective cooperation with global innovation centres. Tech Garden offices have already opened in Silicon Valley and Russia’s technoparks in Skolkovo and Novosibirsk.
“This autumn, 10 companies took the acceleration training programme at our Silicon Valley-based office. They were sector-lead companies, such as Yvision, Orion M2M, Smart Pay etc. The training programme included series of lectures, professional panels, business workshops and one-on-one meetings with mentors, experts, business development specialists and potential partners. According to the participants’ opinion, the training helped them to take a completely new look at the projects and make appropriate adjustments to the business model for entering new markets,” he added.
The Almaty Tech Garden also offers innovative solutions for subsoil users.
“We see high demand for innovative solutions but domestic developers have low qualities compare to the foreign ones. Therefore, our objective is to grow the critical mass of high-tech companies with an appropriate level of competences. At the same time, we should foster a cooperative culture between major enterprises and domestic developers. We have an effective tool that allows the subsoil users to transfer 1 percent of their income to test innovative solutions and this gives an opportunity for tech companies to supply services to subsoil users,” he said.
The fund cooperates with ERG, Kazzinc, Kazakhmys, Voskhod-Oriel and other companies.
“As many as 54 projects like production optimization, energy efficiency, geological exploration etc. worth 2.3 billion tenge have been already funded under this model. We plan to introduce a special information system to automate the process of mining planning and 3D modeling at AK Altynalmas JSC. As a result, we expect a 5 percent decrease in production costs, a 10-15% increase in productivity, 100% downtime removal,” he said.
Challenges in attracting investment
“The main function of Special Economic Zone “Park of Innovative Technologies” is serving as the ground for digitalization of the industry. There are sample projects for digitalization, model factories, lab complexes. We have high demand for this kind of solutions not only in domestic market but in foreign market as well. Thus, we form an ecosystem where local developers can raise their competencies and become part of a global supply chain,” said Kettebekov.
The Tech Garden is working to create competence centres in partnership with multinational corporations including IBM, Autodesk and IntelliSense.io.
“Multinationals provide expertise and half of the investments. That proves that market is interested in our activities,” he said.
A laboratory for Industry 4.0 is being created in partnership with IntelliSense.io, a British technology company. The main task of the centre is to introduce the best practices in processing, enrichment, metallurgy and training. As a result, 75 percent of the working processes in the mining and metallurgical company are expected to be digitised.
“We have been working in the partnership with Metalysis, a British innovative metallurgical company. Together we are creating R&D Centre to examine the potential to make 3D powder out of domestic raw material and to implement demo projects of making metal powder. Development of this direction can make Kazakhstan a main exporter within 4-5 years since there are still no leading countries in this area,” he said.