Polish media: Kazakhstan announces economic and political reforms

Privatization and reduction of state participation in the creation of GDP up to 15 percent, the formation of agricultural cooperatives from more than 500,000 farms, the emphasis on the development of small and medium-sized enterprises, and the decentralization of power are all the content of economic and political reforms that Kazakhstan wants to implement in the coming Years. The columnist for the Polish press agency, Lukasz Oshchinsky, writes about this in his article “Kazakhstan Announces Economic and Political Reforms”.

About this in one  article wrote:  At the end of January, President Nursultan Nazarbayev announced a plan for the decentralization of power – the transfer of part of his powers to the Government and Parliament. As part of the reforms, the Head of State should act as an arbiter between the legislative and executive powers, and also retain powers to manage foreign policy and state security. Parliament will receive a significant role in the formation of the Government and regional authorities. Social and economic policies should fall within the competence of the Government, Parliament and akims. A few days later, in his Address, Nursultan Nazarbayev presented a plan for economic reforms. He said that one of the main goals is privatization. 800 state companies should be sold and not until 2020, as was previously assumed, but before 2018. Only important strategic enterprises should remain in the hands of the state. Ultimately, the state’s participation in the creation of GDP will be reduced to 15 percent, that is, the average level for the OECD countries. The state also wants to stake on the development of small and medium-sized enterprises (N.Nazarbayev announced that until 2050 the participation of small and medium-sized businesses in GDP should be at least 50 percent). This will include, inter alia, a microcredit system for small firms, and prices for utilities, transport and energy services should be reduced through investment. Small and medium-sized enterprises will also develop by reducing bureaucracy and the development of e-administration. Although the mining and metallurgical and oil and gas sectors will retain their strategic importance for the country, the authorities want to diversify exports and increase until 2025 the sale of non-commodity goods abroad. In the coming months, a new export strategy is expected, and the International Financial Center “Astana” will play a leading role in attracting investments. The country is also expected to develop industries that rely on new technologies. In his Address, the President announced major changes in the agricultural sector. They will become revolutionary, within 5 years, more than 500,000 households and small farmers will join the cooperatives. There will also be a new system for storing, transporting and selling goods, and agricultural subsidies will be replaced by insurance of production. Thanks to this, food exports will increase by 40 percent by 2021. The state plans to focus, first of all, on the production of cereals and their export to the whole of Eurasia. In 2017 it is planned to build and modernize 4 thousand km of highways. The port of Kuryk in the Caspian Sea will be expanded, which will become a gateway for exports and imports to the country in the Caspian region. The authorities also plan to build new housing for 1.5 million families over the next 15 years. The cost of bank loans for investors will be reduced through government subsidies. The authorities also plan to co-finance mortgage loans provided to the population by banks. The state-private partnership should become a flywheel of enterprise development, and a number of public services are planned to be transferred to business.
The country’s authorities also set the task of “revealing the stimulating role of monetary policy” and attracting private capital to finance the economy. The purpose of this is to reduce inflation to 3-4 percent in the medium term. N.Nazarbayev also said that the National Bank should be responsible not only for inflation, but also together with the government for economic growth. Subsidizing of bond issue by private Kazakhstani companies will also develop. The President also said that from July 1, 2017, pensions for 2.1 million pensioners will be increased by 20 percent compared to the level of 2016.

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