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A new decade, economic growth, and opportunities for Kazakhstan

One of the difficult periods in the development of our country in the history of the 21st century is coming to an end. The storm of global crisis damaging the world economy still remains. Nevertheless, its force is already different from its original condition. Thanks to our complete readiness, its consequences have not had much impact on our country.

In the pre-crisis period, we achieved a high level of development along with China, India and other countries with rapidly developing economies, because we knew the path we should use in order to achieve this high goal.

The development of our country has been successful thanks to a proper planning and competent implementation of our policies.

Through jointly taken constructive measures, we embarked on the right path of the development. Kazakhstan, with its successes recognized in the world, has increased its capacity and dynamism of the economy.

The model of Kazakhstan’s unity was fully recognised and highly appreciated at its true value by the heads of state and leaders of world confessions. Thus, Kazakhstan has managed to become a strong and successful state and thanks to its initiatives, has reached high international standing.

Through its creative policies, Kazakhstan is widely known for its significant achievements. With regard to all these factors our country was honored to chair the Organization for Security and Cooperation in Europe.

We have started this new decade with that important global mission. And I strongly believe that all our future achievements will have the same success and high results.

Economic development
My key task in the forthcoming decade is to provide further economic development for country, open new opportunities. This address is devoted to this goal.

Following the Strategy “Kazakhstan-2030”, we have successfully realised the first decade of that development program. Nowadays, the task is moving towards the next decade of the Program.

Implementation of the 2010 Strategic Plan, the Critical Stage of State Development
In 1997, upon adoption of the “Kazakhstan — 2030” Strategy we drew up a long-termed agenda, paramount goals and priorities of the country, which were further logically developed in the Strategic Plan until 2010.

We started to live in such a way as we have planned and achieved the following results.
As early as in 2008, ie two years before the pre-planned terms, we doubled the GDP volume in comparison with 2000 and effectively fulfilled social commitments of the state.

Average monthly salaries increased fivefold, and average pensions rate increased threefold.
The share of citizens with substandard income decreased fourfold, from 50% to 12%.

Medical care
Basic criteria of the health of population were improved. Life expectancy increased from 65 to 68 years. Maternal mortality decreased twofold, and birthrate increased by one and a half time.
A total of 652 schools and 463 facilities of healthcare have been built during the 10 years.
Today, we have world-class medical centres, the Maternal and Child Health Centre and the Institute of Neurosurgery.

This year, we will commission the Cardiac Surgery Centre. Medical care of Kazakhstan’s citizens is being improved across the country.

Thanks to these efforts, we will save thousands of lives of our citizens! Recognizing our developments, the UN included Kazakhstan in the ranks of countries with high index of human development in its 2009 report.

This is an indisputable evidence of our increased welfare! In one decade, 350 000 families, approximately 1,2-million people, received new housing. A total of 32 000km of roads were built and repaired, which equals to one third of all roads in Kazakhstan.

Following the letter and spirit of the Development Strategy of Kazakhstan until 2010, we have fulfilled all the goals outlined for the first decade of the 21st century.

Period of Crisis — Time for Right Decisions
The world financial and economic crisis affected our economy’s growth rate, but failed to stop our development. The accumulated economic potential ensured our sustainability in the most severe battles with crisis over three last years.

We protected the financial system of the country, saved major banks.

We didn’t leave behind small and medium businesses.

We attained the unheard of growth in “Kazakhstan’s share” in public purchases of national and transnational companies.

Unprecedented assistance was rendered to the agricultural sector. The state undertook all expenditures related to completing the mortaged housing construction.

Owing to the successful implementation of the “Road Map-2009” program, 862 projects on reconstruction of the municipal housing have been implemented, 737km of electrical lines, 1 029 water supply networks, 284km of heating pipelines, motor roads, hundreds of schools and hospitals, cultural and sport objects have been repaired.

It was the first time we fulfilled such a substantial work, touching every village. People are grateful to us, we did a good job.

All the work was done under my control, in a swift and open manner.

We avoided recession because we knew what had to be done and we did it fast. The great Nehru once said: “Success mostly come to those who act bravely”. And we did act bravely.
In 2009, the economic growth amounted to 1,1%, and the industry grew by 1,7%. We entered a “breakthrough” group of countries with positive expansion rate.

Gross foreign currency reserves and assets of the National Fund have already exceeded $50 billion, and have increased more than 25 times during the past 10 years.

It is worthwhile to say that even though last year we spent some portion of funds, today the volume of the Fund exceeds the amount of last year.

Thanks to the Fund, we not only took anticrisis measures, but also returned considerable assets to the state which we had had to sell in tough times. These include the Ekibastuz State District Power Station — 1, the Bogatyr coal mine, our shares in Kashagan, Mangistaumunaygaz and all three oil refineries. The unemployment rate amounted to 6.3% which is below the rate noted at the pre-crisis period.

More than 400 000 jobs were created throughout the country owing to the effectively implemented “Employment Strategy”.

Development strategy
We have withstood the hardships. We now begin implementing the development strategy until 2020.

The Strategic Plan 2020, Kazakhstan’s Way to Leadership
We are to:

  1. Prepare the economy to post-crisis development
  2. Achieve sustainable economic development due to expedited industrialization and infrastructure development
  3. Invest actively in the future in order to increase competitiveness of the human capital
  4. Provide Kazakhstan’s citizens with qualitative social, housing and utility services
  5. Strengthen the interethnic harmony, national security, and further develop international relations.

Proper Trade Policies, the Support of Economy’s Competitiveness
Kazakhstan is an active participant of integration processes throughout the CIS. The establishment of the Customs Union with Russia and Belarus that came into force since the first of January 2010 is a breakthrough for all of Kazakhstan’s integration initiatives.

The creation of a Single Economic Space since January 1, 2012, becomes the next stage of integration of the three countries. It will mean a higher level of integration when free movement of capital and manpower will be provided.

Supporting regional economic integration in the CIS, the Government should expedite the processes of accession to the World Trade Organisation on the conditions meeting the priorities of economic development of Kazakhstan.

I believe that already now it is important for our entrepreneurs to evaluate the emergence of new possibilities, seriously engage in elaboration of effective strategies on entering new markets, increase competitive advantages.

Certainly, as they say, “where is no competition, one sleeps better but lives worse”. Citizens of Kazakhstan do intend to live better, and will not allow anyting to stand in the way of their plans.

Attracting Investment
It is obvious that state resources would not be enough for the realisation of our diversification plans. Foreign direct investments should become its basic source.

The issues of attracting investment to Kazakhstan were of high priority during my international visits. Many states see reasons in investing in our economy.

Today, the issues of attracting investments from China, South Korea, the United Arab Emirates, as well as the French, Italian, and Russian companies amounting to $20 billion are resolved.
These investments will be channeled to the non-raw materials sector, will provide commissioning of dozen of facilities under the industrial program, of infrastructure and joint ventures.

The issues of attracting approximately $3 billion in investment for the “Western China — Western Europe” motorway and two billion dollars for gas pipeline from the west to the south of the country are also resolved.

All of this is notwithstanding investments into materials sector which will comprise more than $10-billion. As you see, great work on supporting this program with financial and material resources has been done.

We must create most attractive environment in Kazakhstan for investors willing to work in our region.

Taking into account priorities of industrial development, new approaches to the functioning of Special Economic Zones and industrial parks are required. I charge the Government to develop a new bill on Special Economic Zones.

The mechanism of the public-private partnership carried a substantial potential for attracting private investments.

We have launched this mechanism in Kazakhstan, but it requires improvements in accordance with the best international practices.

I charge the Government to make appropriate changes to the legislation on concessions in the first half of the year. In order to introduce the principle of project financing, we need to stipulate the legislative possibility of establishing special project organisations with the special legal status.

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