Taking into account the tasks outlined by the President in the framework of the Address to the People of Kazakhstan “A just state. One nation. A prosperous society”, a new economic policy was adopted in early April. The goal of all structural reforms within its framework is to create a sustainable development of the country and a qualitative increase in the well–being of citizens.
The new economic policy, in fact, is a synergy of economic and political reforms. Within its framework, in the medium term, all the resources of the state will be focused on the implementation of strategic functions to ensure national security, the rule of law, the development of human capital, the expansion of basic infrastructure, regional development, coordination and regulation of economic processes.
“The key priorities of the new economic policy are aimed at building an open and predictable model of economic development based on fair competition, proactive attraction of high-quality investments, technological transfer and a high level of human capital. At the same time, the foundation of gradual transformations will be the Strategy of achieving Carbon Neutrality until 2060, according to which Kazakhstan needs to decarbonize the economy and build a sustainable low-carbon model of economic development to create new growth drivers. To achieve this goal, all measures taken will be aimed at ensuring macroeconomic stability, economic diversification, digitalization, development of SMEs and human capital,” the authors of the Forecast of socio-economic development of the Republic of Kazakhstan for 2024-2028 summarize.
The agro-industrial complex accelerates the pace
One of the main priorities of economic policy, according to them, remains the development of the agro-industrial complex. It is planned to implement reforms in this area within the framework of the Agribusiness Development Concept for 2021-2030 and the National Agribusiness Development Project for 2021-2025. Both documents are aimed at increasing the competitiveness of the industry by increasing labor productivity by two and a half times, increasing exports of agricultural products by two times and providing the population with socially significant food products of domestic production.
Thus, diversification in crop production will be ensured by intensifying explanatory work among land users and strengthening control over compliance with the requirements of land legislation. We are talking about optimizing the areas of mono- and water-intensive crops (rice, cotton) and the expansion of alternative highly profitable crops (oilseeds, legumes, cereals, grain, vegetable, fodder, etc.), which will contribute to an increase in their production. To accelerate the renewal of the technical park of the agro-industrial complex, measures of state support for the purchase of agricultural machinery will be improved.
In order to improve breeding work, the methods of DNA analysis and genomic evaluation of animals will be widely introduced into production. It is planned to take measures to accelerate the development of beef cattle breeding using the experience of developed countries. Work will continue on the development of a network of dairy farms and poultry production facilities.
The subsidy system in the industry will be reformed by optimizing the types and amount of subsidies. The volume of subsidies aimed at reducing the cost of products will be revised, with their replacement by concessional lending with a low interest rate. And due to the introduction of new mechanisms for using the right to lease agricultural land as collateral, the availability of credit resources will increase. The implementation of systematic measures for their adaptation to climate change will continue by expanding the total area of irrigation of agricultural land, construction and reconstruction of irrigation canals and reservoirs.
Oil, gas and peaceful atom
According to analysts, the development of the oil and gas sector will be aimed at increasing the volume of oil production at large fields, as well as meeting the needs of the domestic market for petroleum products, diversifying export routes for oil transportation. Currently, the issue of stimulating the development of highly developed and late-stage oil and gas fields is being worked out. It is expected to adopt a Comprehensive plan for the development of major oil and gas and petrochemical projects for 2023-2027.
Last year, a comprehensive plan for the development of the gas industry until 2026 was approved, which provides for measures to increase gas resources, ensure the domestic market, taking into account the state policy of restraining prices for it, and implementing gas industry management reforms. Further development of the gas transportation system and gasification of the population is defined in the updated General Scheme of gasification of the Republic of Kazakhstan for 2022-2030.
The target vision of energy capacity development is aimed at generating electric energy, building new power plants and maintaining existing capacities. The work on the planned sustainable development of the energy complex will be carried out within the framework of the Energy Balance until 2035, according to which the growth of new capacities is expected to almost double.
As part of the development of the nuclear industry, investment opportunities are being explored in the stages of the pre-reactor nuclear fuel cycle, which can provide a long-term and significant increase in added value.
Industrial transformation
In turn, industrial policy is focused on creating conditions for stimulating the competitiveness of manufacturing enterprises that are able to adapt to changes in geopolitical and economic processes. Thanks to the implementation of the projects of the Unified Industrialization Map, the diversification of the economy will continue due to the opening of new production facilities, accelerated development of high-value industries, increased non-resource exports and attracting foreign direct investment in non-resource sectors.
The state industrial policy will be implemented within the framework of the Manufacturing Industry Development Concept for 2023-2029. The main directions here are the creation of a technologically progressive industry, modernization of fixed assets, digital transformation of enterprises focused on products of medium and upper processing with a focus on inclusion in global supply chains. In accordance with the main directions of the National Development Plan of the Republic of Kazakhstan until 2025, the emphasis in the state industrial policy will be placed on the creation of an export-oriented economy with high added value.
The priorities of development in ferrous metallurgy will be the production of new types of composite alloys with the use of magnesium–chromium steel alloys for heavy machinery, in non-ferrous metallurgy – aluminum alloys with the addition of titanium and silicon for use in the automotive and aviation industries. In the machine-building industry, the strategic direction in general is the localization of domestic production, which contributes to the achievement of economic and technological security, the independence of the country from geopolitical and macroeconomic changes. New directions will be developed in the coal industry, modern technologies for the enrichment and deep processing of coal will be introduced. The development of agrochemistry will continue in the chemical industry, the production of nitrogen fertilizers and polymers will become promising areas.
The emphasis in the construction industry is determined by the formation of a competitive domestic market of building materials. Work will continue to provide the domestic market with the most demanded construction goods (sanitary ware, laminated coating, glass wool, ceramic tiles, interior doors, thermal insulation materials) of domestic production, as well as the promotion of goods produced in Kazakhstan with unique characteristics that are in demand on the world market (for example, the production of chrysotile and chrysotile cement products).
The development of the pharmaceutical industry will be aimed at meeting the country’s needs for domestic medicines by modernizing existing and building new production facilities, providing the industry with human resources and attracting investment for the implementation of projects. Active measures for cooperation with global pharmaceutical corporations (Big Pharma) and attraction of investments, transfer of technologies and the latest developments in the domestic production of medicines and medical devices will contribute to an increase in its volume.
The prospect of the development of light industry is at the heart of the development of the commercial segment. In this aspect, the sector will focus on the development of marketing, design, distribution, as well as the production of finished products, national brands in the field of clothing and footwear.
Everything for a tourist
In addition, Kazakhstan has recently adopted a Concept for the development of the tourism industry of the Republic of Kazakhstan for 2023-2029, under which employment in this area should increase to 740 thousand people in five years, and the growth in gross value added will reach more than 5.6 trillion tenge. The document also provides for the development of a culture of entrepreneurship among the general population, the conduct of family, small and medium-sized businesses, including through the implementation of anchor projects in priority tourist areas.
The state also intends to create favorable conditions for attracting investments in the industry, the growth of which in accommodation and catering services will reach about 220 billion tenge. This will happen due to the fact that priority tourist areas will be provided with high-quality engineering, transport and tourist infrastructure. The task is to create maximum comfort along the route of the tourist, including airports, railway stations, bus stations, roadside service. Stable mobile network coverage with Internet access will be provided at all key transport and logistics infrastructure facilities, which will allow providing a wide range of digital online services for tourists.
In addition, the developers of the document promise to establish flights from all regions of the country to the main tourist destinations. The number of passenger cars will be increased in the directions leading to the resort areas of the country. The service at the places of accommodation and tourist facilities will meet international standards, the tourist will receive high-quality services. In general, the introduction of digital tools will increase competition in the tourism market, as well as facilitate interaction in the industry between entities.
Smart Trading
In turn, the objectives of the development of the trade industry are the creation and development of a modern system that ensures the saturation of the market with quality products and the competitiveness of export goods and services. In order to reduce the level of the shadow economy, develop various trade formats (retail chains, markets and other formats of civilized trade) and achieve high indicators in the field of domestic trade, the state policy of financial and non-financial support of the industry will be revised, aimed at stimulating development on the basis of partnership between the state and business.
The main platform of the food hub will be the National Commodity Distribution System, which is a full-cycle infrastructure from production to shelf, which will be integrated into the country’s trade infrastructure, forming a single ecosystem for a significant expansion of the agricultural market.
In addition, a set of measures for the further development of electronic commerce is being implemented. It will be carried out in three directions – stimulating SMEs to switch to online business, the development of delivery services and logistics services, as well as the development of cross-border e-commerce.
As part of the development of non-commodity exports, measures will be taken for Kazakh exporters to provide financial support through compensation, insurance, guarantees and subsidies, as well as through non-financial instruments, support programs, the involvement of foreign institutions of the Ministry of Foreign Affairs of the Republic of Kazakhstan, the development of services with high export potential, the adoption of new national standards that meet international safety and quality requirements.
Of course, these reforms are only a small part of the New Economic Policy. It is no coincidence that a large number of independent experts, representatives of the business community, industry government agencies and research institutes were involved in its development. As Kassym-Jomart Tokayev emphasizes, unprecedented global challenges require a complete rethinking of the economic policy being pursued, accordingly, he called on them to completely change their approaches to achieving their goals.
A source: https://e-cis.info/news/566/110251/
