Karaganda region set to expand infrastructure construction, attract tourists

ASTANA – In an exclusive interview with The Astana Times, Karaganda region Akim (Governor) Yerlan Koshanov speaks about the prospects of the region’s economic development, including infrastructure construction, and plans to attract tourists to the most promising destinations.

Yerlan Koshanov

What is on the socio-economic agenda for the region? What is planned to improve the situation in the coming years?

 

Last year, we focused on the tasks set by the President in his state-of-the-nation addresses, namely New Development Opportunities in the Fourth Industrial Revolution of Jan. 10, 2018 and Growing Welfare of Kazakh Citizens: Increase in Income and Quality of Life of Oct. 5, 2018, as well as Five Social Initiatives, the Plan of the Nation 100 Concrete Steps to Implement Five Institutional Reforms and other policy documents.

The measures taken are aimed at ensuring economic growth.

At the end of 2018, the short-term economic indicator was 102.4 percent.

Investment in fixed capital increased by 20.6 percent, the volume of construction works went up by 19.8 percent and there was a 11.4 percent growth in housing construction.

Exports increased by 3.3 percent, while growth in agriculture was 6.2 percent.

The volume of tax revenues to the local budget increased by 13.1 percent. We have achieved growing indicators for quality of life and well-being of the population – 100 percent of pre-school education coverage of children aged 3-6, an 8.1-percent increase in incomes of the population and a more than 12 percent increase in the average monthly wage.

In the short term, we have a challenge to bring economic growth from 5.2 percent this year to 7.7 percent by 2023.

The dynamics are expected to be achieved due to growth in labour productivity by 24 percent and an increase in exports by 10 percent.

We need to increase fixed capital investment in the non-commodity sector by 47.6 percent until 2023, taking 2018 as a baseline.

Labour productivity in agriculture and export of processed agricultural products will be also increased.

Positive dynamics will be ensured by increasing production of crops and livestock, by purchasing imported breeding stock and by implementing 62 investment projects.

The volume of construction works by 2023 is projected to increase 1.7 times, or by 119 billion tenge (US$314 million) in comparison to the base year, and will amount to 275.8 billion tenge (US$727.9 million).

There are plans to increase the volume of trade by 43 percent or 268.8 billion tenge (US$709.4 million) by 2023, in comparison to 2018.

The goal will be attained by the annual construction and opening of 100 new facilities in the field of trade and services, modernisation of markets, full completion of the Alfarukh wholesale and distribution centre in the city of Karaganda and state support for small and medium-sized enterprises (SMEs) as part of the Business Road Map.

Thus, the planned economic growth will bring the per capita gross regional product (GRP) to 5.9 million tenge (US$17,000) by 2023 compared to 3.4 million tenge (US$10,200) in 2018, an increase of 1.7 times.

 

How much foreign investment has been brought to Karaganda Oblast in 2017 and 2018? Please tell us about the most significant projects in the fields of construction, manufacturing and agriculture.

 

In 2018, the volume of investment amounted to 470 billion tenge (US$1.2 billion), increasing by 22 percent, and it was private investment that created the upward trend. These figures were achieved thanks to the implementation of 33 new large investment projects worth more than one trillion tenge (US$2.6 billion). It is worth noting that 17 projects include foreign participation and multinational companies.

Of the total number of on-going projects, we have commissioned eight. Among them:

– Solar power plant in Saran Special Economic Zone (SEZ), which is the largest in Central Asia, with a capacity of 100 MW;

– Sary-Arka copper processing plant for the production of copper cathode based on the technology of heap leaching, liquid extraction and electrolysis;

– Modernisation of machine-building production of Maker, using the industrial internet;

– Modernisation of the Altynalmas gold production factory, applying advanced technology to save the environment;

– First phase of construction of the Alfarukh wholesale and distribution centre with the application of advanced technology for warehouse logistics and online operations; and

– construction of the Uly Dala supermarket for the development of agricultural producers of the Zhezkazgan region.

 

Please also tell us about the activities and projects in the field of public-private partnerships (PPP).

 

In general, 32 contracts for the total amount of 9.8 billion tenge (US$25.9 million) have been signed in Karaganda Oblast in 2017-2018.

In 2018, we concluded 11 contracts worth 2.4 billion tenge (US$6.3 million), including in the areas of education – 2.1 billion tenge (US$5.5 million) and healthcare – 320 million tenge (US$844,500).

The implementation of these projects helped to:

– Start providing health services based on new technology in districts where such services have not been provided before;

– Reduce essential waiting lists to enrol in preschool institutions;

– Attract private investment to the healthcare and education system in the amount of 3.5 billion tenge (US$9.2 million); and

– Create 566 new jobs.

In order to streamline the work in the region, we developed a pool of 79 PPP projects.

In 2019, there are plans to start the implementation of 36 projects worth 26.3 billion tenge (US$69.4 million).

It includes sectors such as education, health, sports, language development, digitisation, construction and housing and utilities services.

 

What is being done to attract tourists? How many tourists visited the oblast in 2018?

 

Karaganda Oblast has a high potential for the development of the tourism industry. We have chosen three points of growth to focus on – the resort area of Balkhash region; Ulytau, the cradle of the Kazakh Khanate, and Karkaralinsk, a unique natural park.

In 2018, we focused on the development of transport accessibility to our tourism destinations. Thus, the road of national significance from Karaganda to Ulytau was repaired and approximately 80 kilometres of roads leading to sacred places of the Ulytau district were repaired.

The Karaganda-Karkaraly highway was repaired.

In addition, the construction of the four-lane Karaganda-Balkhash highway was begun and overhaul works have been launched at an airstrip at the Balkhash airport, which will further enable the opening of regular flights for aircraft of all classes.

New recreation facilities are being built for the advancement of tourist centres. Since 2015, about 30 projects have been implemented in the region for the construction and reconstruction of accommodation facilities.

In order to further develop the tourism industry by 2020, there are plans to implement approximately 20 projects for the construction of new accommodation and recreation facilities, including the construction of a visitor centre in the Ulytau district.

The Balkhash resort area was included in the top 10 tourist map destinations under a project of the State Programme for the Development of Inbound and Domestic Tourism. In this connection, the international consulting company McKinsey & Company, with the assistance of the oblast akimat (administration), has developed a master plan that includes measures for infrastructure development, landscaping and promoting the tourism potential of the resort area.

Moreover, the Karkaraly and Ulytau districts were included in the top 50 regional destinations of the tourism map (as part of the state programme). A master plan for the development of the Ulytau districts has been developed and a master plan for the development of the Karkaraly resort zone is under development.

In general, the works carried out had a positive impact on the increase in figures in the tourism sector. For instance, according to the latest statistics, over nine months of 2018, the number of tourists in the region amounted to 212,600 people. The number of visitors in the Balkhash resort area was 3.1 percent higher compared to the previous year and amounted to almost 33,000 people (comparing to nine months of 2017).

The major goal is to increase the share of tourism in the GRP from 0.6 to 4 percent with the increase in the number of tourist arrivals from 300,000 to one million people by 2030.

 

Please tell us what work is being done to improve the transport system in Karaganda Oblast.

 

The road capacity of Karaganda Oblast is 12,558 km; thus, Karaganda Oblast is the fifth largest in the nation in terms of the length of roads.

In 2018, funds were allocated from all levels of the budget to repair 1,215 km of public roads.

The implementation of the Nurly Zhol programme has given impetus to the development of the entire road-building sector in the region, the production of road-building materials has increased, approximately 2,500 new jobs have been created and it also contributes to the development of modern and high-quality roadside services.

Currently, the reconstruction is being carried out in the Karaganda-Temirtau section. In addition, the construction of new sections of roads continues as part of the reconstruction of the northern and eastern detours of the city of Karaganda (the total length of the detours is 48.6 km), which will make it possible in the future to exclude the transit movement in the oblast centre’s road network.

However, last year, repair works were completed on the middle sections of the Karaganda-Zhezkazgan highway (with a total length of 387 km) and roads in the direction of Bayanaul, Karkaralinsk and Ulytau were also repaired (with a total length of 54.6 km) in order to improve the tourism cluster.

As for the repair and maintenance of oblast roads, funds were allocated in the amount of 7.2 billion tenge (US$19 million) in 2018, due to which three bridges were reconstructed, overhaul works were continued at two sections in Abai and Aktogai districts and on average, 368 km of roads in all areas of the region were repaired.

The reconstruction of bridges across the Taldy River in the Karkaraly district and across the Nura and Sokur rivers in the Bukhar-Zhyrau region, which were destroyed by floods in 2015, has been completed. Currently, the bridges are commissioned.

At the same time, there are plans to complete the overhaul works in 2019 at the Karabas-Zhartas road with a length of 17 km in the Abai district and Aktogai-Balkhash road with a length of 20 km in the Aktogai district.

This year, there are plans to start overhaul works on the 19-km long Karaganda-Saran-Shakhtinsk highway in the Bukhar-Zhyrau district, with the implementation period of three years. Meanwhile, reconstruction started in 2018 on a 17-km section of the Novodolinka-Shakhan-Molodetskoe road in the Bukhar-Zhyrau district. The repair work is being performed according to the production schedules.

According to the road map, there are plans to increase the share of good-quality roads of regional and district importance in the Karaganda Oblast to 90 percent by 2022, if timely and full funding is available.

In 2018, for the first time funds from the oblast budget for the repair of intra-village and district roads were provided in the amount of 2.8 billion tenge (US$7.4 million) and the total length of the roads is 257 km. This activity will continue in subsequent years.

As for the road-building season of 2019 in Karaganda Oblast, the repair works are planned to cover 903 km for a total of 56.2 billion tenge (US$148.3 million).