ел бесігі»: капитальный ремонт проведут в 74 школах в 2019 году

НУР-СУЛТАН. КАЗИНФОРМ – В рамках проекта «Ауыл – ел бесігі» до сентября будет проведен капитальный ремонт в 74 общеобразовательных учебных заведениях, передаёт корреспондент МИА «Казинформ».

«В основном будут отремонтированы объекты социальной сферы. Будут строиться новые объекты, будет построено 12 физкультурно-оздоровительных комплексов. Естественно, есть определенные сроки строительства. Сейчас пройдут «Последние звонки» и будет проведен капитальный ремонт в 74 школах. Они будут проведены до начала учебного года», – сказал вице-министр национальной экономики Ермек Алпысов на пресс-конференции в СЦК.

Спикер отметил, что в основном большинство проектов направлены на ремонт, строительство автомобильных дорог внутри населенного пункта.





Kazakh SMEs generated more than $73 billion in 2018, continue to grow

NUR-SULTAN – Kazakh small and medium sized businesses (SMEs) generated more than 28 trillion tenge (US$73.8 billion) in 2018, said Vice Minister of National Economy Yermek Alpysov at a May 22 press briefing.

Vice Minister of National Economy Yermek Alpysov.

The number of SMEs also grew 8.3 percent to 1,241,328 compared to 2017, with the most in Almaty, the capital and the Turkestan Region.

The SME share of the country’s GDP grew from 25 percent in 2015 to 28 percent in 2018. SME engagement rose by 3.4 percent, he said.

Kazakhstan’s road map providing for measures to develop businesses until 2020 includes support for SMEs. The country committed 210.5 billion tenge (US$555.2 million) within four years of the programme.

“These funds, first of all, allowed financing 13,000 SMEs, training 20,000 entrepreneurs every year on average, creating 10,000 jobs and producing output exceeding three trillion tenge (US$7.9 billion). They paid 175 billion tenge (US$461.5 million) annually in taxes,” said Alpysov.

“Fifty-three billion tenge (US$139.8 million) or 25 percent [of the funds] were used to build the infrastructure near plants and SMEs; the rest is used for guaranteeing loans, providing grants, training and consultancy services,” he added.

The demand, he noted, is very high. Starting this year, the government will allocate 600 billion tenge (US$1.58 billion) to address affordable loan provisions as part of an Economy of Simple Things, a new programme focused on developing the light manufacturing, construction and furniture industries.

Since the beginning of the year, second-tier banks have approved 15 billion tenge (US$39.5 million) in loans for 28 applications. An additional 104 projects worth 139 billion tenge (US$366.6 million) are pending approval.

Damu Business Development Fund, a subsidiary of Baiterek Holding, also subsidised 24 projects worth eight billion tenge (US$21.1 million).

Baiterek Holding Chair Aidar Arifkhanov noted SMEs can apply to the fund to receive subsidies and collateral security should they lack sufficient collateral.

“We support businesses in small and mono cities and rural areas, in priority sectors of the economy and our export potential and exporters that target foreign markets. Over these years [since 2010], we subsidised 13,000 projects and provided collateral to 5,000 projects,” he said.

Atamaken National Chamber of Entrepreneurs Chair Eldar Zhumagaziev noted lack of sufficient collateral is a common obstacle for SMEs in securing funding through banks.

“According to the survey, 66.7 percent of respondents said banks deny loans citing lack of liquidity. This is a huge hurdle. Another 67 percent said banks do not accept their collateral as they are based outside the city. We strongly urge the ministry to help with alternative measures,” he said.

Increasing business capacity is one of the programme’s important directions. Enterprises can learn business basics, enhance their competency and receive consultations, with specialists explaining how to develop a business plan, pay taxes, submit declaration and obtain licenses.

Atamaken provides free services to entrepreneurs at their business service centres across the country. More than 174,000 businesses have used the services, including 19,000 online.  

“The impact is obvious. More than 46,000 companies were opened, more than 8,000 companies expanded their business and more than 23,000 entrepreneurs were able to receive more than 206 billion tenge (US$543.7 million) through our consultations and services. More than 74,000 people got trained at our business school,” said Zhumagaziev.

He noted state support measures need to be analysed.

“Perhaps it will be a quarterly or annual report and if some of the measures do not work, it will be possible to incorporate a new, effective one into the programme. I believe we need this, because there is digitisation going on, a very huge flow of new technologies from abroad. Liquidity of the company depends on technological efficiency of the process, which makes it hard to survive on the market,” he said.

The ministry is currently preparing a draft business development road map until 2025 and has formed a working group to start the discussion.

Alpysov urged the business community to take part in the decision making process.

“We are ready to consider all suggestions. I am sure these measures will ensure availability of business support measures and financing and will give an opportunity to increase the contribution of business to the country’s economy. We need to focus on business,” he said.



Kazakhstan seeks to boost number of e-commerce buyers to 15 million by 2025

NUR-SULTAN – Kazakh officials say e-commerce friendly legislation and increased agricultural sales have the potential to push e-commerce sales in Kazakhstan to 15 million buyers annually by 2025.

E-commerce sales in Kazakhstan increased 1.5 times in 2018 over 2017 to $707.4 million and the number of buyers doubled over 2017 to 2.3 million people.

The market currently offers approximately 1,700 online shops and nearly 20 electronic marketplaces that allow approximately one million small- and medium-sized businesses to sell products.

Government officials recently announced they hope to increase e-commerce sales to $5.25 billion by 2025 and push to 25 percent e-commerce’s percentage of total retail by the same year. They also hope to increase the number of people employed in the e-commerce sector from the current 33,002 to 314,000 by 2025.

“Electronic commerce is a global trend, one of the most rapidly developing areas in the service economy,” said Kazakh Prime Minister Askar Mamin at a May 14 government meeting.  Mamin added e-commerce should be regarded as a driver of economic growth.

To reach these goals, officials recently adopted a law protecting consumer rights when making online purchases. The law provides the same protections that apply to over-the-counter purchases. The government has also approved tax incentives until 2023, is providing reimbursements up to $316 for businesses to purchase equipment to accept online orders and has simplified the export declaration process.

Sixty-eight percent of Kazakhstan’s e-commerce market are products, mostly construction material and household appliances, and 32 percent are services, mostly flight and train tickets, tickets for cultural events and communal services payment. Kazakh Minister of National Economy Ruslan Dalenov noted that agriculture is also a sector where e-commerce sales can be increased.

“E-commerce does not have territorial boundaries. Therefore, it is about endless opportunities for our local agriculture producers to enter new markets and search for new clients. Online trade is a great opportunity to boost trade in rural areas,” said Dalenov.

Food products and agriculture goods currently account for 4 percent of total e-commerce with annual revenues of $40.5 million.

An increase in e-commerce sales could also help grow Kazakhstan’s transit sector. Kazakhstan serves as a strategic transit hub between East and West. In 2018, 670 million parcels were delivered from China to Europe and nearly 7 percent of those passed through Kazakhstan.

The target is 864 million parcels and $3.3 billion in transit revenue by 2025.

“Given the existing infrastructure of Western China – Western Europe corridor, a big area is opening for truck carriers along with freight and logistics. The multiplicative effect of e-commerce on the economy can ensure an annual contribution to GDP at 1.1 percent and increase the traffic from China to Europe via Kazakhstan and in return direction from 2,000 to 21,000 trucks per day by 2025,” said Mamin.



Agricultural development is central to Ayul candidate for Kazakh president

NUR-SULTAN – Ayul People’s Democratic Patriotic Party candidate Toleutai Rakhimbekov, who is running for president in Kazakhstan’s upcoming election, will focus on developing the agricultural industry, equal opportunities for rural citizens and promoting traditional values, according to his recently announced platform.

Toleutai Rakhimbekov. Photo credit: tengrinews.kz.

Improving agriculture takes centre stage, encompassing his stance on the economy, development and science.

Rakhimbekov considers agroindustry key to modernising the country, saying it can provide “a significant multiplying effect for the economy.” The platform states the goals should include both completely meeting Kazakhstan’s demand and working on exporting agriproducts. The goal can be reached with affordable agricultural leasing policies, as well as greenhouse development.

“Kazakhstan’s agroindustry must become capable of ensuring food security and leading in the global environmentally-friendly products market,” states the platform.

The programme proposes improving the infrastructure to procure, process and sell agricultural products; developing trade and improving agricultural production mechanisms. Complexes to produce, store and process livestock products should help develop Kazakhstan’s exports, according to the platform. Grants should also be provided for new farmers.

Agricultural science is also emphasised as an important element in developing the industry. Rakhimbekov intends to develop and implement mechanisms for agrarian business/scientist communication, as well as tools to implement resource-saving, innovative and climatic green technologies for cultivating crops, genomic selection of cattle and biological methods of plant protection.

“The agroindustry should move to a new technological level, to intelligent systems of mineral fertilisers and plant protection products and to digital technologies,” states the platform.

The party’s social policies are directed at minimising the inequality between urban and rural citizens, as, the platform argues, “[they] should serve the development of each and everyone.” The goal would be achieved by developing rural infrastructure and implementing improvement measures for villagers’ living standards, teaching them practical skills to organise their own businesses and providing access to “long and cheap money.” Other sources of support are optimising social assistance, improving medical services and determining the main rural development trends and needs.

Rakhimbekov’s youth policy, like his other social policies, offers an “actual social guarantee” for youth which also focuses on issues pertaining to rural citizens. Specifically, he is offering to teach them skills relevant for rural areas, create a special jobs bank and provide social housing and zero interest student loans with obligations of returning to work in the rural area.

“Young people should not leave the village, but, to the contrary, having received an education, should live in their small homeland in order to change the reality for the better, creating comfortable living conditions in the village,” notes the platform.

Rakhimbekov’s campaign also stresses keeping traditional values intact.

“The development of modern Kazakhstan is impossible without taking into account the history and culture of the people, without understanding the origins of ethnic development, the priority spiritual and moral values of our culture,” states the platform.

Born in the Karaganda region, Rakhimbekov, 55, graduated from Kazakh Agricultural Institute in 1986 and received a law diploma from Buketov Karaganda State University in 2001. Before the party nominated him as its candidate, he was appointed April 16 as head of the National Agrarian Research and Education Centre, which includes three agricultural universities and 23 research institutes. He is known in Kazakhstan for being active on social media.



Kazakh 5G, next generation of wireless, is closer than it seems

NUR-SULTAN – Introducing 5G will be a key driver of productivity in Kazakhstan and other marketplaces, said Mikko Lavanti, Nokia vice president for the Central East Europe and Central Asia market unit, in an exclusive interview with The Astana Times.

Photo credit: telecomstechnews.com.

Nokia and Kazakhtelecom hosted a 5G demonstration corner at the May 16-17 Astana Economic Forum (AEF). The stand showed advantages such as ultra-low network latency, high access speeds at 10 gigabits per second and remote control with high response accuracy.

“5G technology will be similar to the massive change 2G GSM (Global System of Mobile Communications) networks were at one point. What it means is that 2G brought the mobility. Suddenly, we had access available to most of the people who could be mobile. The next generation 3G and 4G have brought mobile Internet to everybody. 5G will be different,” said Lavanti.

Nokia Vice President for the Central East Europe and Central Asia market unit Mikko Lavanti.

5G will differ from its predecessors in three ways.

“First, there will be a cloudification. All the data will be stored in clouds and this data, we call it like the new oil. Kazakhstan has a lot of oil, but the data will be the next oil,” he noted.

5G will use Artificial Intelligence (AI) and machine learning, allowing it to “produce and handle the data to create new services,” he added.

The third way is its huge impact on industry regarding latency. Ultra-low latency is done machine-to-machine, creating an immediate response. By contrast, previous generations were build for machine-to-human interface with a 50-millisecond delay. This is roughly the time it takes between eye to brain.

“So, here at the Astana Economic Forum together with Kazakhtelecom, our 5G demonstration showed the low latency and its importance for new services,” he said.

5G should create a safer and more productive work environment, for example in mining, healthcare, and oil and gas, as many operations that humans currently must do on site can be completed remotely, he said.

The next logical question is “when will 5G come?” The Kazakh government brought the seeds to introduce 5G technologies to the country and will run a test mode in the next several years.

Kazakhtelecom and the Ministry of Digital Development, Defence and Aerospace Industry developed and approved a 5G testing roadmap, which the company and Nokia completed in November.

“Together with Kazakhtelecom, in December last year we brought the first 5G technology here. This is what we call fixed wireless access. Imagine in that way, that instead of building the fibre to home we are doing the last mile with the radio connectivity that already provides the first 5G experience. This is what we say it is a small trial,” said Lavanti.

“In the very near future, we plan to test Nokia 5G NR solutions in Nur-Sultan and Almaty,” said Kazakhtelecom Board Chair Kuanyshbek Yessekeyev during the AEF presentation.

Although it will be available in limited technical use this year, a fuller network will be accessible in 2020. It will still, however, be in test mode, he noted.

Regarding use by the masses, Kazakhstan might keep the 5G pace of other developed countries. The nation’s young population, which can create the right environment and government openness to develop the correct regulatory environment, should accelerate the process, he said.

“When I look at the list of the Kazakhstan plan, when I look at all the aims of the government, all the aims of the telecom operators and the natural resources you have here, I feel that there is a great future…. I think I believe strongly that the target of Kazakhstan to be in the top 30 countries in the world in the time frame that the government set will be met. I think you are doing the right things in the right time and we are very happy to work here,” Lavanti added.



Samruk Kazyna’s privatisation programme to facilitate Kazakh national companies’ IPOs

NUR-SULTAN – Samruk Kazyna Sovereign Wealth Fund developed a privatisation programme to launch the initial public offerings (IPOs) of Kazakhstan’s major national companies and engage foreign investors, said its Assets Management Managing Director Almasadam Satkaliyev May 17 at the 2019 Kazakhstan Global Investment Roundtable (KGIR).

Almasadam Satkaliyev. Photo credit: invest.gov.kz.

Kazatomprom, the world’s largest uranium producer, placed 15 percent of its shares worth $431 million on the London Stock Exchange and Astana International Exchange in November. It was the first national company listed on an international stock exchange, and its shares were purchased by 49 foreign and 17 local companies and 2,700 Kazakh citizens.

Kazakhtelecom and Air Astana are expected to go public this year, giving momentum to the government’s privatisation programme.

“All IPO cases are different, each with a different strategy and approach,” said Satkaliyev at the roundtable on Kazakhstan’s Privatisation Drive: Building a Capital Market Through the IPO of State-Owned Champions. “Kazakhtelecom is the leading telecommunications operator in our country, accounting for 61 percent of mobile network communication. Its shares will be listed at the Astana International Exchange this year, and we are almost at the final stage. We anticipate a strong interest from the investor community because they like the company’s history.”

Stock market launches of Kazakhstan Temir Zholy, KazPost, KazMunayGas, Qazaq Air, Samruk Energo and Tau-Ken Samruk were initially planned for 2020.

“Tau-Ken Samruk is a promising national mining company that deals with solid minerals. Currently, the company operates eight projects in metals, such as zinc, copper, gold and silver. All of them are at different stages of development. We believe that we need a special programme for this company and need to attract international investment institutions and banks as investors,” he said.

Kazakhstan Temir Zholy, Kazpost and Qazaq Air, in particular, will undergo thorough preparation before launching their IPOs.

“We are working on the financial stability of the companies and understand that they should pass this stage in two to three years time and, only then, can go public,” noted Satkaliyev. “We enlisted KPMG as an independent expert (for Kazpost), and they advised that we list a certain number of its shares. Kazpost’s current operating conditions require subsidies from the government for things such as a local postal service. We believe that all these companies are very promising, especially Kazpost because it has a very interesting logistics project.”

The third annual KGIR, headlined by Kazakh Prime Minister Askar Mamin, convened more than 1,100 business executives, influential policymakers and international experts from 41 countries to promote Kazakhstan’s investment potential and introduce new technologies and global best practices for local implementation.



UN Women calls for women’s economic autonomy, equality, childcare schemes

NUR-SULTAN – Gender equality is the solution to our current problems and we all need to step up and speak out, said Åsa Regnér, Assistant Secretary-General and UN Women Deputy Executive Director, at the May 17 First Kazakhstan Forum on Achieving the Sustainable Development Goals (SDGs) as part of the Astana Economic Forum.

Åsa Regnér. Photo credit: Astana Economic Forum press centre.

Regnér noted gender equality accelerates social inclusion and the need to create women’s autonomy with the right to decide about their own lives and their own incomes.

“We have to be more strategic and we have to work together, all of us. We need governments. We need the private sector. We need organisations. We need individual men who speak about gender equality and stand on the side of women and girls and speak out when you hear some of these not so constructive things being said both about women and about gender equality and women’s rights today,” she said in her remarks.

Social inclusion, social security and gender equality were the topics at this year’s Commission on the Status of Women, the UN’s second largest meeting after the General Assembly.

“Kazakhstan was very active this year with its delegation and they also had a side event around this year’s theme of the social protection system, access to public services and sustainable infrastructure for gender equality and the empowerment of women and girls. We have lots of evidence today that economic growth, use of education and labour force participation will be accelerated if we work with women’s rights and gender equality. Countries will have a larger basis for taxation, social security and reduction of poverty if you work with gender equality. The governments need to put some very important schemes in place; for instance, accessible care, child and elderly care for both women and men to be able to participate in the workforce,” she said.

Childcare and parental leave are important reasons for social inclusion. Financing in line with gender budgeting for these programmes is essential, too.

Photo credit: Astana Economic Forum press centre.

“Men are fertile their whole lives. Women have a very small amount of years when they can have children. Still, women are being punished for having children, although the kids have both a mother and a father,” she said.

Regnér also shared her impressions about the gender aspect of the SDGs in an interview for this story.

“I think it is very important to have these discussions on what the SDGs actually mean to change people’s lives and I think that this is a good platform for that. I think that it’s also good to have a session as we did about gender equality; but ideally, I think that gender equality has to be part of all the discussions, because society consists of women and men, boys and girls. What is needed is the political will and commitment from the highest level and funding. It is the member states [of the UN] who are responsible for implementing the SDGs. They have to have the political will not only to work with the SDGs, but also to do this power shift from men to women, actually because men have power just for being men. And women have less power just because they are women. If we are to fulfil the SDGs, there has to be a certain power shift and it definitely has to be a shift in budgeting, resource allocation and taxation as well, because otherwise the gains will not be sustainable,” she said.

The gender pay gap is a worldwide issue and there are different ways of addressing it in different countries with different traditions.

“For instance, in Sweden, if you are an employer of a company with more than 20 employed people, you have to map what you pay every worker; you have to do a mapping of everybody at the workplace in relation to gender. Every country should find its own way to ensure equal pay between women and men,” she noted.

Regnér provided some recommendations for women who want to find a balance between running a business and a family.

“Men should share unpaid work with women. They should also share the care of their own little babies. Normally, men who actually do care for their children find that it is very gratifying. We know that when a child has been close to the father and the mother in the early ages, as a newborn and a toddler, they also connect with the father later in life, as a teenager or as a grownup, which men tend to really appreciate. The government should introduce childcare schemes, elderly care schemes and social security so that women and men can have a life, but also have paid work. These are normally quite expensive issues for a government, but examples in the world show that investing in it actually pays off. If you have a huge labour force with both women and men, you have a stronger economy and inclusive growth,” she said.




AIFC, Bitfury to jointly implement blockchain projects

NUR-SULTAN – Astana International Financial Centre (AIFC) and the Bitfury blockchain company agreed May 17 to create projects using blockchain technology. Bitfury also plans to open data centres in Kazakhstan to diversify the work environment and cooperate with Nur-Sultan Akimat (city administration).

“We are pleased to welcome Bitfury in Kazakhstan and the AIFC is ready to support the development and distribution of blockchain technology in the region. I am confident that the development of human capital will receive an additional inducement as well,” said AIFC Governor Kairat Kelimbetov at the May 17 session of the Astana Economic Forum.

“We are honoured to work in Kazakhstan in partnership with the AIFC. We are encouraged by their enthusiasm for more transparent systems as well as their commitment to participate in a growing global economy powered by blockchain technology. We look forward to serving the citizens of Kazakhstan and the region in these efforts,” Bitfury CEO Valery Vavilov told the forum.

“Bitfury has already shown its strong commitment to education and equal access to technology through its blockchain operations in Georgia and Ukraine, among others,” said Bitfury Kazakhstan Head Timur Bairov at the forum.

“We believe that we can help to build a brighter future for the people of Kazakhstan by introducing blockchain technology across many sectors,” he added.

Bitfury also plans to develop human capital by launching education and training programmes in partnership with the AIFC Bureau for Continuing Professional Development. Due to the partnership start-ups and IT companies in the country and the Central Asian region will have an opportunity to collaborate with a major technology player creating products using the AIFC platform.

Successful startups that have passed mentoring and created projects at the AIFC Fintech Hub will be promoted by Bitfury around the world, including receiving expertise and mentoring from company representatives.

Bitfury is also going to work with Nur-Sultan Akimat on social projects using blockchain technology and support new technologies for energy efficiency and environment protection.

The company has chosen the AIFC for development, showing confidence in the new ecosystem of financial markets, protection of the rights and interests of consumers of financial services and investors, as well as of trade and investment cooperation.

Bitfury Group is one of the world’s leading full-service blockchain technology companies. It develops solutions using the most effective technologies in blockchain security, infrastructure, cryptocurrencies, semiconductor chips and mobile data centres with individual characteristics.



AEF participants call for Central Asian integration through connectivity, developing human capital

NUR-SULTAN – Astana Economic Forum (AEF) participants discussed the role of Kazakhstan May 17 in cooperation with Central Asia and the Organisation for Economic Cooperation and Development (OECD). As a regional hub, they called on Kazakhstan to facilitate regional connectivity with global economy through transport infrastructure and improving human capital.

The panel session dedicated to OECD country review presented the latest cooperation results between the organisation and Kazakhstan, paying particular attention to OECD reports on labour productivity and regional connectivity.

“I want to thank Kazakhstan for supporting OECD’s work not only in Kazakhstan, but in the whole region,” said OECD Global Relations Secretariat (GRS) Eurasia division head William Tompson during his welcoming remarks. “Kazakhstan is our most active and main partner in the region. At the end of last year, we finished the country programme with Kazakhstan and signed a new memorandum on cooperation. Today, we will present the results of two projects. The first part [of the session] is about labour productivity, one of the main issues for Kazakhstan, and the second part is dedicated to trade and transportation connectivity in Central Asia. These issues are tightly interconnected, because improvement of connectivity will increase the competitiveness level of the market.”

Cooperation between Kazakhstan and OECD began in 2008 as part of the Eurasian Competitiveness Programme covering 13 countries in Central Asia, the Caucasus and Eastern Europe. Today, Kazakhstan cooperates under the memorandum of understanding between its government and the organisation. The country took OECD standards as a guide to improve its economic and social conditions, implementing them into national programmes and strategies.

“It is ten years already that OECD standards became a guide for structural economic and social reforms in Kazakhstan,” said First Deputy Prime Minister and Minister of Finance Alikhan Smailov. “Kazakhstan entered the list of 50 competitive countries and 30 countries in ease of doing business. During the independence years, Kazakhstan attracted more than $320 billion in foreign direct investments. It is more than 80 percent of the investments attracted to the Central Asian region. It shows global business trust in Kazakhstan… The country’s trade with OECD countries is more than half of the goods turnover in the region.”

Alikhan Smailov. Photo credit: Sorokina Elena.

Kazakhstan certainly has space to develop and has already seen results, especially in attracting foreign investments and business development.

“Today, we are facing a period of global sluggish growth. In this context, cooperation between the OECD countries and Kazakhstan has had to improve policies here in the country. Implementation challenges remain, of course, but there was clear evidence of the Kazakh government’s commitment to improve in many spheres. Kazakhstan, for example, has increasingly opened economic sectors for foreign investment… The country also introduced facilitation mechanisms like the business ombudsman,” said OECD GRS Director Andreas Schaal.

Kazakhstan signed a country strategy in 2015, implementing 13 projects during the first phase (2015-2017). OECD made recommendations in healthcare, education, employment, social integration, career enhancement, environment, competitiveness, business environment, regional development, public administration and statistics. The second phase consists of 15 projects and OECD recommendations are expected in 2020. To date, the country has executed three projects; the rest are in process.

In the future, Kazakhstan and OECD plan to work together to improve labour productivity, education, tourism, public administration and anticorruption policies.

“We set an ambitious goal to reach developed countries’ indicators by 2050 – to reach a $60,000 gross domestic product per capita in purchasing power adjusted dollars, to increase life expectancy by 11 years reaching 84 years, to decrease the unemployment rate to 3 percent… and increase goods and services exports to $90 billion. We also want to decrease the government’s share in the country’s economy,” said Minister of National Economy Ruslan Dalenov.

To increase labour productivity and follow OECD suggestions, the country started the Digital Kazakhstan programme, which is “a new and good source of economic growth,” he noted. Kazakhstan also has the potential to develop in e-commerce and goods transit.

Implementing the recommendations, the country also became a member of a number of OECD bodies.

“Participating in the OECD bodies and in such OECD tax evasion global initiatives as the fight against cross border gives Kazakhstan a more active role and allows the country to have different perspectives to high level international discussion in investment, industry and education,” said Schaal.

OECD reports indicate that, although Kazakhstan has shown productivity growth in recent years, the country remains dependent on the oil and gas industry. The organisation suggests digitisation is one of the main drivers to reach high and stable productivity growth.

“To understand the factors that make some firms so much better than others in not only adopting technologies, but making the most of them, …we can categorise them [the factors] in three broad groups such as incentives, capabilities and opportunities. Incentives are a pressure that firms are facing to invest in new technologies to keep their competitive edge… It is the degree of market competition, openness, ease of entry and exit… Capabilities are skills. They are not literacy, problem solving… they are technical skills, exposure to computers, understanding digitisation and good managerial skills. Opportunities are about allowing new, innovative firms to achieve the scale needed to make their investment profitable,” said OECD Economics Department Deputy Director Alain de Serres.

Alain de Serres. Photo credit: Sorokina Elena.

“We are not talking just about numbers; we are talking about our people, citizens. Productivity is not just about making work more efficient; it’s about enabling them to improve their skills and working conditions. And connectivity is more than facilitating movement of goods and capital; it enables use of technology and more crucially of ideas. In the end, it means more and better jobs,” stressed Schaal.

Concerning connectivity, the OECD report suggests Kazakhstan continue developing hard and soft infrastructure (for example, border crossing procedures), paying particular attention to its assessment tools and seeing the development from a broader perspective to distinguish the impact of one project to another.

“Another element is highlighting the importance of not only looking at one measure at a time… If you improve the border crossing, there might be shifts where and when you need to invest for the infrastructure as well. This brings me to another point, which is extremely important – building analytical capacity in the region to be able to assess changes and plan infrastructure needs related to the other measures,” said OECD Quantitative Policy Analysis and Foresight at International Transport Forum head Jari Kauppila.

Jari Kauppila. Photo credit: Sorokina Elena.

The two-day forum included more than 50 sessions and events, a record in AEF’s 12-year history. In conjunction with the OECD country review session, the second day presented numerous activities including the first Forum for Sustainable Development Goals in Kazakhstan, the International Monetary Fund’s inaugural roundtable, a session on green technologies and building, smart cities, artificial intelligence, cybersport, women in business and science, youth issues and civil society.



China-Europe railroad shipment route through Kazakhstan, Russia, Belarus exceeds expectations in 2019, says UTLC President

NUR-SULTAN – The China-Europe railroad shipment route that crosses Kazakhstan, Russia and Belarus has become more popular due to the efforts of the United Transport and Logistics Company (UTLC) and participating countries, said President Alexey Grom at the company meeting with the press.

Photo Credit: Atameken Business Channel.

“When it comes to reverse (from Europe to China) volume, we can analyse the years 2016, 2017, 2018 and 2019. Initially, there were a large number of empty containers, but if you are a container relocations business, there will always be some container park relocation. If there is no balance of shipment, if there is no 100-percent balance of shipments, so a large amount – up to 50 percent of containers, were empty,” he noted.

Yet Grom notes there is a change, with more clients becoming interested in the UTLC route.

“Then, we saw that more and more enterprises of the automobile industry – such as Volvo, for example – started seriously considering railroad shipping. By the way, in 2018, we conducted a large conference in Xi’an, which is a large distribution centre for Europe-made Volvo cars. The company representatives said that they decided to change their strategy in favour of railway transit… Food from Europe is our other priority, as China is in the top three countries that consume premium-class products… Pharmacy, automobile industry. There are also products with a very low cost; cellulose from Finland, for example,” he noted.

He also talked about the way company peers felt correcting the imbalance was impossible.

“Now, it gets worse in a way, because of China’s decision to no longer subsidise empty container shipments. So, now, we and our European transport partners are looking for a cargo base. The issue is, when you have a certain route, it’s hard to change it, and the sea-to-railroad changes are really significant for our clients… We plan for the balance to be 75 percent… Initially, we were told that the imbalance correction is impossible, though,” said Grom.

The Europe-China TEU (twenty-foot equivalent unit, which can be used to measure a ship’s cargo carrying capacity) shipment was 152,846 in 2018. Transportation in the China-Europe direction was 223,348 TEUs. Both numbers showed growth in 2018, however, with the general TEU transportation growing 60 percent compared with 2017 results.

The reason for the growth is in the positive incentives the company is able to provide – speed, as a train from Dostyk station in Kazakhstan reaches Kaliningrad in five and a half days, and reliability, which allows for the constant shipment of goods. The reason behind these advantages is both in the countries’ efforts to ensure a smooth transition and the company trying to innovate the route.

Grom particularly praised the Khorgos Gateway (dry port connecting Kazakhstan and China) for allowing the company to reduce the time spent processing train documentation from three-four hours in conventional ports to 40 minutes in Khorgos. Company efforts to ensure a smooth transition include more effective management of various aspects involved in shipment procedures in Europe and China (UTLC does the shipment between China-Kazakhstan borders and Russia/Belarus-Europe border) and gradually removing the need for paper-based documentation that slows shipping speed.

UTLC provides container transportation service by regular container block trains on the China-Europe-China route through Belarus, Kazakhstan and Russia. Its shareholders are the National Union Belarusian Railway, Kazakhstan Temir Zholy and Russian Railways.