Kazakhstan: Open Door Policy for Investors in Action
Nur-Sultan, 22 February 2022 – A working meeting of the Foreign Investors Council was held online under the chairmanship of President of Kazakhstan Kassym-Jomart Tokayev. The event was attended by global heads of multinational companies, representatives of international economic and financial organizations.
Opening the meeting, the President confirmed that the state will fully fulfill all its international and domestic obligations and guarantees to partners and investors. The work on creating a favorable investment climate in Kazakhstan is a priority and in this regard, he called on the members of the Council to take a direct part in the ongoing reforms.
The event presented up-to-date data showing the positive dynamics of the country’s economic indicators. According to the results of last year, Kazakhstan's economy grew by 4%. The real sector has become the driver of sustainable growth. The volume of industrial production increased by 3.8%, including in the manufacturing industry by 5.5%. The key factor of positive changes was high investment activity in non-primary sectors.
In 2021, 44 major investment projects with foreign participation worth 3.6 billion dollars were implemented and commissioned. More than 7.5 thousand jobs were created. At the same time, the greatest number of projects were in mechanical engineering, namely 8, also 8 in renewable energy, 6 in mining and metallurgy, 5 in agro-industrial complex.
The gross inflow of FDI for the first nine months of last year increased by almost 50% and reached 18.8 billion dollars.
Kazakhstan has never defaulted on its sovereign financial obligations and always been a reliable economic partner. The investment climate in Kazakhstan remains favorable, which is confirmed by international rating agencies and organizations.
Leading international rating agencies, including Moody’s, Fitch and Standard & Poor’s in 2021 positively assessed the Kazakh government’s efforts to stimulate the recovery of economic growth and confirmed the sovereign credit rating of Kazakhstan at the level of investment reliability with a «stable» outlook.
The Kazakh President noted the Council’s great contribution to the achievement of these indicators and urged investors to continue active mutually beneficial cooperation.
In turn, the members of the Council expressed confidence in the security and stability of the authorities of Kazakhstan in terms of protection of foreign investments and fulfillment of all obligations, supported the ongoing reforms, and voiced a number of their initiatives.
Thus, the Vice-President of the European Bank for Reconstruction and Development Alain Pilloux suggested three key areas, which will maximize the opportunities for recovery and improvement of the investment climate in Kazakhstan.
The first is to increase the competitiveness of the private sector and diversify the economy by reforming state-owned enterprises, restructuring the Development Bank of Kazakhstan and Samruk-Kazyna with the introduction of improved corporate governance measures, international procurement rules, and further digitalization.
The second is to accelerate Kazakhstan’s transition to a green economy, carbon neutrality and resilience to the effects of climate change.
The third is to promote regional economic integration through the private sector by expanding access to employment opportunities and qualifications, improving access to finance and reducing intraregional inequality.
David Livingstone, Citi’s CEO for Europe, the Middle East, and Africa, stressed that company remains loyal to Kazakhstan as a strategic and reliable partner.
“The country faces difficult challenges: maintaining the level of international investment in Kazakhstan will be underpinned by the imperative of the rule of law, transparency, and a set of principles of governance. Citi’s experience as a global financial institution serving clients in 160 countries has shown that a strong and consistent focus on these principles is a critical factor in establishing and maintaining investor confidence. As one of the largest foreign investors in the country, Citi is positively portraying Kazakhstan’s story around the world by providing access to our network of institutional investors,” he said.
James Johnson, Executive Vice President, Upstream, at Chevron Corporation, talked about new ways to make Kazakhstan’s energy sector more attractive. Appreciating the Kazakh government’s commitment to guaranteeing the inviolability of existing contracts and recognizing the importance of competitive and predictable investment conditions, he noted that all these measures will help Chevron continue to invest in Kazakhstan and contribute to reducing the carbon intensity of the oil and gas industry, the development of new low-carbon products and solutions.
Cameco’s Chief Executive Officer and President Tim Gitzel said, “backed by more than 30 years of experience, Cameco remains a strong supporter of investing in Kazakhstan today and in the future. As a company that has been operating in Kazakhstan for nearly 30 years, we have recently witnessed the strength of character and resilience of the people of Kazakhstan. We know Kazakhstan as a favorable jurisdiction for investment, with a stable investment climate, respect for contractual rights, and the existence of a balanced and predictable tax regime”. He added that Cameco is open to increasing its cooperation with Kazatomprom through further investments in uranium production and processing in Kazakhstan. As fuel to produce safe, clean, and reliable nuclear energy, uranium will be in increasing demand in the coming years as the world takes steps toward decarbonization and sustainable electrification.