THE UNITY OF THE PEOPLE AND SYSTEMIC REFORMS ARE A SOLID FOUNDATION FOR THE PROSPERITY OF THE COUNTRY
Dear compatriots!
Dear Members of Parliament and members of the Government!
This year we celebrate the 30th anniversary of Independence – this is our highest value.
Thanks to the far-sighted policy of the First President – Elbasy, Kazakhstan has achieved significant success and has become known all over the world.
In unity and harmony, we were able to build a new state – this is our main achievement.
We have strengthened the spirit of the nation by laying a solid foundation for development. They have become an influential member of the world community. Thanks to the stability in society, we have embarked on the path of sustainable progress.
We are building a strong state together. Sovereignty is not empty slogans and big words. It is important for us that every citizen feels the fruits of Independence, the main of which are peaceful life, social harmony, improving the welfare of the people, and confidence of young people in the future.
All our initiatives are aimed at this. Thanks to the unity and creative work of Kazakhstanis, we successfully overcome all difficulties and trials.
Our country is on the threshold of the fourth decade of Independence. It is already obvious that this time will not be easy. Therefore, we must be ready for any challenges and threats, continuously improve and always move forward.
My current Message to the people of Kazakhstan is devoted to the following issues.
I. ECONOMIC DEVELOPMENT IN THE POST-PANDEMIC PERIOD
Kazakhstan's largest economy in Central Asia is currently experiencing the consequences of the pandemic. Nevertheless, despite the difficulties, we consistently implement our course.
In order to define a medium-term economic policy and systematize government initiatives, we adopted a National Development Plan until 2025 and switched to a new system of state planning. National projects will be approved.
Our strategic goal is to strengthen our leading role in Central Asia and strengthen our position in the global economy.
To further attract direct investment, a new instrument has been introduced – a Strategic Investment Agreement.
Concrete measures have been taken to optimize the quasi-public sector. The merger of Baiterek and KazAgro holdings has been completed. Portfolio companies have been cut in half, and their staffing has been reduced by one and a half times. As a result, a new powerful development institute has been created.
In the context of the pandemic, the state provided large-scale and operational support to citizens and businesses.
The program "Economy of simple things" has proved its effectiveness. As part of its implementation, more than 3.5 thousand projects have been launched, 70 thousand jobs have been created, goods and services worth 3.5 trillion tenge have been produced.
Thanks to the Business Roadmap program, 66 thousand projects received state support. This helped to create and save more than 150 thousand jobs.
The initiative on early use of pension savings had a serious economic, but above all social effect. This measure has helped more than a million of our fellow citizens to improve their living conditions or reduce the mortgage burden.
In general, there is a positive trend in the economic development of our country. Nevertheless, we must openly say that the situation is still difficult.
Therefore, I decided to extend the validity period of the "Economy of Simple Things" and "Business Roadmap" programs for 2022. The total amount of funds allocated for their financing will be at least one trillion tenge.
Largely due to the low public debt and the presence of significant reserves, Kazakhstan is relatively successfully overcoming the consequences of the pandemic. This is our serious competitive advantage, it is important not to lose it.
However, recently there has been a trend when the budget deficit and transfers from the National Fund are increasing to cover expenditure obligations. It will not work all the time to follow such an "easy" path. The stock of financial stability is far from unlimited. Obviously, measures are needed to increase budget revenues. But first of all, we need control over the volume and efficiency of government spending.
To restore the assets of the National Fund, the implementation of the budget rule should be accelerated. The relevant legislative amendments should be adopted by the end of this year.
In general, the country needs a set of rules for the management of public finances: public debt, budget policy, National Fund. I ask the Government and the National Bank to prepare a Public Finance Management Concept by the end of the year.
Along with this, it is necessary to continue work on economic diversification, expanding the range of manufactured goods and the geography of exports.
By the end of 2020, for the first time in 10 years of industrialization, the contribution of the manufacturing industry to the development of the economy exceeded the share of the mining industry. The medium-term goal is to increase manufacturing exports by 1.5 times to $24 billion by 2025, and labor productivity by 30%.
The law "On Industrial Policy" being developed should provide answers to the questions facing the manufacturing sector. One of them is the problem of access to raw materials. It is necessary to introduce a simple rule – the price of raw materials for the domestic industry should be affordable, and the volume should be sufficient. By the end of the year, the Government must find the best solution to this important task.
At the same time, it should be borne in mind that the resource potential of our country has not been fully disclosed, geological knowledge remains at a low level.
It is necessary to expand investors' access to high-quality geological information. To do this, an effective National Geological Service should be created on the basis of disparate subordinate organizations. This organization should not become a monopolist who decides who and how to admit to the subsoil. Its role is to provide comprehensive service support to investors.
The subsurface use industry needs a new impetus, especially in terms of geological exploration and integrated study of the subsurface. The reforms initiated within the framework of the National Plan should be brought to a practical conclusion – to create an open digital database of geological information, to provide investors with access to it.
The subsoil is a national treasure. Decisions on access to them through backstage discussions in the quiet of offices should be outlawed. The relevant authorities will ensure control over this issue.
Further. The excessive presence of the state in the economy seriously hinders its growth and competitiveness, leads to corruption and illegal lobbying. State-owned enterprises still dominate in many sectors and enjoy monopoly benefits.
We have started to solve these problems. Thus, the Concept of Public Administration provides for measures to reduce the quasi-public sector, increase its efficiency, transparency and accountability. The Supreme Council for Reforms has approved a new privatization plan. Now we need strict control.
But there are other questions. In particular, why do individual national companies and state-owned enterprises work at a loss, and their first managers are not responsible for this? The government has to solve this problem.
We are also facing an uncontrolled increase in inflation. The National Bank and the Government were powerless in front of it, referring to global trends. Such excuses highlight the vulnerability of the national economy. Another question arises: what then is the role of our professional economists?
The main task of the National Bank and the Government is to return inflation to the 4-6% corridor.
As a result of the implementation of anti-crisis measures totaling 6.3 trillion tenge, an excess money supply has appeared in the economy. But there are niches in which these funds do not arrive. Second-tier banks do not invest in small projects, especially in rural areas.
Therefore, it is necessary to use the potential of microfinance organizations. They work locally, know customers, their business and opportunities. The National Bank and the Financial Regulation Agency should prepare a package of decisions on this issue.
Of great importance is the work to reduce the level of stressful assets.
We have made a decision – the state should not help bankers. At the same time, frozen assets should be returned to economic circulation, but exclusively on a market basis. This requires a legislative framework. The Government, together with the Financial Regulation Agency, should submit a bill to Parliament by the end of the year.
Now about the non-monetary components of inflation. The main one is food prices.
A lot is said about the huge agricultural potential of Kazakhstan. But a lot of problems have accumulated in the field of agriculture.
First of all, this is inefficient pricing and distribution of food products. Earlier I spoke about the importance of creating a network of wholesale distribution centers. This task is under implementation.
It is important to ensure access to them for small agricultural producers, including, possibly, personal subsidiary farms. Monopolization of this market is unacceptable.
It is also necessary to ensure uniform control over prices along the chain from the producer to the consumer. Now several departments are responsible for this work. After another jump in prices, instead of thoughtful analysis and taking effective measures, they begin to "nod at each other." It's time to put things in order in this case. It is necessary to delineate the areas of responsibility, identify one body as the main one, and prescribe clear regulations for the interaction of other departments. The Government must make a decision on this issue within a month.
Secondly, adverse weather conditions have exposed serious problems in animal husbandry. By operational measures, we have stabilized the situation with food supply. However, systemic actions are still needed in this area.
It is necessary to expand the areas of cultivation of forage crops and strengthen control over the observance of crop rotation, make greater use of the possibilities of space monitoring and remote sensing of lands. It is also important to increase the efficiency of pasture use.