ASTANA – The State Property and Privatization Committee of Kazakhstan’s Ministry of Finance named the most profitable state and quasi-state companies, reported Kazinform.
Photo credit: The Astana Times
The list includes SK-Pharmacy, KazAvtoZhol, Problem Loans Fund, Zhasyl Damu, Kazspetsexport, Center for Labor Resource Development, KazAeroNavigation, Baiterek Holding, and the Samruk Kazyna Sovereign Wealth Fund.
SK-Pharmacy
SK-Pharmacy supplies medicines under Kazakhstan’s guaranteed volume of free medical care and works to strengthen the resilience and competitiveness of the country’s pharmaceutical industry. In 2023, it reported 424 billion tenge (US$867 million) in revenue and a net profit of 11.54 billion tenge (US$23.6 million).
However, the Anti-Corruption Service and Ministry of Health uncovered serious corruption risks within the company, revealing that more than half of its drug procurement auctions were conducted non-competitively. This allowed pharmaceutical companies to collude, winning tenders at inflated prices. During the procurement of medical equipment, the tender commission accepted bids from suppliers whose applications did not meet the required terms, leading to inflated purchase costs. An analysis of 13 contracts, totaling 6.7 billion tenge (US$13.7 million), revealed potential overpricing risks.
KazAvtoZhol
KazAvtoZhol, the national operator for road management, reported revenue of 39.36 billion tenge (US$80.5 million) in 2023. The company manages 25,000 kilometers of national roads, with construction currently underway on 3,100 kilometers. An estimated 2,000 kilometers are set for completion this year.
KazAvtoZhol has sought financing from the World Bank for a sustainable transportation improvement project. The World Bank and the Asian Development Bank are expected to each contribute $650 million, with an additional $231 million coming from the Kazakh government. A portion of these funds will be used for the repair and reconstruction of the Karaganda-Zhezkazgan highway.
Chairman of the Board, Darkhan Imanshev, noted that about 90% of Kazakhstan’s road construction is funded by external debt, and 70% of major roads are built by foreign companies, mainly Chinese.
Problem Loans Fund
The fund focuses on stabilizing the banking sector by acquiring assets from second-tier and former banks, then reintegrating these assets into the economy through restructuring, debt recovery, and sales. In 2023, it reported 11.2 billion tenge (US$22.9 million) in profits from goods and services.
Zhasyl Damu
Zhasyl Damu, the operator of the recycling fee program, reported a net profit of 28 billion tenge ($57.3 million) in 2023. Through the Industrial Development Fund, the company implements a preferential financing mechanism for waste management projects, promoting waste reduction and the development of the recycling industry. This includes support for purchasing garbage trucks, sorting lines, and recycling plants. A total of 185 billion tenge (US$378.6 million) has been allocated at interest rates of up to 3% per year, with terms ranging from three to 15 years.
Among the major projects are the construction of a solid waste processing plant with electricity production in the Almaty Region, a paper and cardboard production plant in Almaty, and a glass container production plant with a line for cullet processing in Kyzylorda, totaling around 104 billion tenge (US$212.8 million).
In February, the Ministry of Ecology and Natural Resources, in collaboration with Zhasyl Damu, developed a new recycling program for vehicles and agricultural machinery. The program allows all businesses involved in processing ferrous metals to participate, eliminating any single-company monopoly.
KazAeroNavigation
In 2023, KazAeroNavigation reported revenue of 150 billion tenge (US$307 million) and a net profit of 74 billion tenge (US$151.4 million). The company’s main activities include air traffic management, flight safety, and providing aeronautical and meteorological information to Kazakhstan’s airspace users.
Baiterek Holding
Baiterek Holding posted total income of 421 billion tenge (US$861.6 million) in 2023, with post-tax profit of 11.54 billion tenge (US$23.7 million).
This month, Baiterek Holding completed the sale of 100% of Bereke Bank’s shares to Lesha Bank, valued at 65 billion tenge (US$133 million). The proceeds will be transferred to the country’s National Fund.
Lesha Bank, listed on the Qatar Stock Exchange, is licensed by the Qatar Financial Center Regulatory Authority and specializes in investment banking and asset management, with operations in Qatar, the United States, Europe, and the Middle East.
According to regulatory reports from Baiterek, Bereke Bank posted a net profit of 13.6 billion tenge (US$27.8 million) for the first half of 2023. The bank’s capital adequacy ratio rose from 9.4% on January 1 to 11.2% by July 1.
Samruk Kazyna Sovereign Wealth Fund
Samruk Kazyna Sovereign Wealth Fund reported a net profit of 2.13 trillion tenge (US$4.35 billion) in 2023, driven by strong performance in several sectors. Uranium sales reached 18,100 tons, a 10.4% increase over 2022. Railway freight turnover by Kazakhstan Temir Zholy rose 7% to 262.4 billion ton-kilometers.
QazaqGaz’s natural gas sales totaled 24.1 billion cubic meters, exceeding 2022 figures by 1.4 billion cubic meters, while oil and gas condensate production by KazMunayGas National Company increased by 6.8% to 23.5 million tons.
However, KazMunayGas’s overall performance was affected by a significant drop in oil prices.
The article was originally published in Kazinform.
