Q: What role will Kazakh Invest play in Kazakhstan’s new investment promotion architecture?
A: It is crucial that Kazakh Invest should be at the very core of this new architecture. Kazakh Invest will bring together all the dispersed information [about investing in the country] and all the measures of state support to investment, and process them into a simplified form. At the end of this, investors will receive ready-to-use information packages to help them make a decision.
Second, the prime minister [Askar Mamin] identified Kazakh Invest as the unified database of all the investment projects in the country. The government estimates that the country needs to increase FDI by three or four times from its current levels and each ministry has been given a target in terms of expected FDI growth, with some sectors such as energy, healthcare and agriculture having the most ambitious targets. Each ministry now has to develop a specific pipeline of projects for which it will be accountable. Once that pipeline of projects is approved, it will be on the balance sheet of Kazakh Invest.
Up until today, there were projects promoted by Kazakh Invest and other agencies, but some key ministries were hesitant over their real priorities. Now the ministries themselves will approve the projects first, so that Kazakh Invest will work on a pipeline of projects that truly represents those supported by the country’s decision makers.
Q: What will be the nature of the relationship between Kazakh Invest and the Astana International Financial Centre [AIFC], which also has a major role in the country’s latest investment promotion architecture?
A: The two institutions will complement each other. The AIFC is looking at the development of capital markets, but will also provide financial and non-financial companies [the opportunity] to incorporate inside its special jurisdiction based on the principles of English common law, and offer access to its independent courts and arbitration system. This solves the main concern of all the investors regarding the safety of their investments. This is the main support we see coming from the AIFC.
Q: Where do you see room to increase FDI?
A: FDI ensures quality economic growth. We want to enable 5% GDP growth for the next 10 years and this figure requires FDI attraction on a massive scale. We are aiming to reach a level of overall investment (public and private) in the economy of 30% of GDP by 2024, from the current 18%. It is a bold ambition – all high-performing countries have a similar investment-to-GDP ratio. With specific regard to foreign investment, the target is an annual $34bn by 2024, from $24bn in 2018. From this perspective, the focus will fall on greenfield FDI, rather than headline FDI. Our four priority sectors are petrochemicals, agriculture, metals and mining, and machine building.
Q: How are you going to improve perceptions of Kazakhstan abroad?
A: We have to switch from a preaching mode to a more proactive mode, where we will do the homework for investors by identifying specific projects of national interest. Then we will also identify and target priority investors. Eventually, those interested in implementing these projects will bypass many procedural levels and [be able to] access unprecedented support.