The Working Meeting of
the Foreign Investors' Council chaired by the President of the Republic of
Kazakhstan was held in the format of a video conference under the chairmanship
of the Head of State. During the event, divided into two sessions, measures of
post-COVID economic recovery and investment activity in Kazakhstan, as well as
issues of developing and increasing the investment attractiveness of the
country's oil and gas sector, were discussed in detail.
Welcoming the meeting
participants, the Head of State stated that the global pandemic had a negative
impact on many life spheres of all countries and noted the importance of
joining efforts in the fight against its consequences.
Kassym-Jomart Tokayev
expressed gratitude to FIC members for their support and provided significant
assistance to employees of their enterprises, to social sphere and citizens of
the country.
The head of state
believes that without macroeconomic and financial stability, economic growth
and the welfare of the population, it is impossible to maintain the country's
investment attractiveness at the proper level. According to him, in the context
of a pandemic, the state has taken a set of unprecedented measures to support
business and the population, which made it possible to reduce the negative
consequences of the crisis and avoid a serious economic recession.
The President also
pointed out the need for serious transformations and reforms aimed at
increasing investment attractiveness, ensuring transparency and predictability
of government policies. To achieve these goals, Kassym-Jomart Tokayev put
forward a number of proposals and initiatives.
The Head of State
outlined the creation of new investment instruments as the first task. For
this, in accordance with his instructions, the mechanism of the Strategic
Investment Agreement has already been developed, which will ensure guaranteed
stability of legislative conditions on the part of the state for the entire
period of validity.
Kassym-Jomart Tokayev
dwelled on the need to improve the business climate in the country. The
government will prepare a qualitatively new regulatory system. All control and
supervisory, permitting and other regulatory instruments will be subject to a
large-scale audit. In addition, the Head of State noted that this year the
protection of investors from corruption pressure has been strengthened.
Anti-corruption support of the Anti-Corruption Agency covers over 500 business
projects totaling more than 12 trillion tenge.
The President also
focused on the issue of ecology, informing the foreign participants of the
meeting about the development of a new Environmental Code, prepared on the
basis of the advanced approaches of the OECD member countries.
- Enterprises that have
implemented these technologies will be exempted from emission fees. Let me
emphasize that such a mechanism, when the state shares the costs of the
environment with enterprises, is not available in every country. In fact, this
is a large-scale project of public-private partnership. We deliberately chose
this approach. We expect that the business will fully fulfill its part of the
agreements, - said Kassym-Jomart Tokayev.
The head of state also
highlighted the possibilities of the IT sector, which, in the face of the
negative consequences of the pandemic, provided a powerful incentive for the
accelerated development of the digital economy. According to him, the
development of the domestic IT industry, where Kazakhstan plans to attract at
least 500 billion tenge within 5 years, requires serious support from global
technology companies.
- Today, about 6% of
the world's mining is concentrated in Kazakhstan. In addition, the development
of the IT market, engineering and other high-tech services opens up serious
opportunities for export. We plan to attract investments from major global
players in the field of cloud computing and platforms. Preparatory work has
begun on the construction of four mega-data processing centers - in Nur-Sultan,
Almaty, Shymkent and Atyrau. These are colossal computing power that will be
located on a large international information highway, - the Head of State
noted.
Kassym-Jomart Tokayev
stressed the importance of developing the domestic pharmaceutical industry. The
President stated that by 2025 Kazakhstan expects to increase the share of its
own pharmaceutical production in the country to 50%. In addition, the
production of medical equipment and consumables will be actively developed.
These areas are open for investment, and such projects, as it was said in the
speech, will receive full support from the state.
Within the framework of
the event, issues of development and improvement of the investment climate in
the oil and gas sector were separately discussed.
Addressing the
participants of the session, the President noted that this industry has become
a driving force in attracting foreign investment to Kazakhstan. The development
of this area contributed to the rise of new sectors of the economy, such as oil
refining, petrochemicals, oilfield services, pipeline and sea transport.
Kassym-Jomart Tokayev
believes that in the face of declining demand for oil and a decrease in the
investment attractiveness of the industry, a difficult adaptation to new
realities is ahead, and a significant part of this adaptation will be
associated with state policy.
In this context, the
Head of State called for joint efforts to address a number of important tasks.
Kassym-Jomart Tokayev
pointed out the importance of the timely completion of large oil and gas
projects in the Tengiz, Karachaganak and Kashagan fields. In particular, the
President instructed to timely implement the transition to the full-scale
development of Kashagan and accelerate the implementation of the project to
build a gas processing plant at this field.
The need to increase
local content in oil and gas projects was noted in the speech. In the opinion
of the Head of State, the time has come to move from quantitative to
qualitative indicators in this matter.
Kassym-Jomart Tokayev
also drew attention to increasing the investment attractiveness of geological
exploration. He instructed the Government, together with oil and gas companies,
to improve the sectoral regulatory framework, taking into account the current
realities and vision for the future development of the industry.
The President focused
on issues of fiscal policy, declaring his readiness to update tax legislation
as needed, based on the balance of economic interests.
- I supported the
request of foreign investors - next year the current thresholds for bringing
business to criminal liability for tax violations will be revised. In other
words, truly effective tax decriminalization will be carried out, - stated
Kassym-Jomart Tokayev.
Focusing on the
prospects of the oil and gas chemical industry, the President expressed the
opinion that success in promoting this direction could significantly change the
specialization of our country.
- The project for the
construction of an integrated gas chemical complex has not been completed for
more than 10 years. The Energy Ministry should think about the possibility of
providing special conditions for the production and export of oil and gas for
companies willing to invest in refining projects, - stated Kassym-Jomart
Tokayev.
In addition, the Head
of State noted the importance of environmental protection and the development
of a low-carbon economy. He recalled that in 2021 a new Environmental Code will
come into force in line with advanced international standards. The President
urged interested stakeholders to contribute to the development of this
extensive policy document.
Summarizing his
participation in the meeting, the President assured that all the proposals and
requests made during the meeting will be carefully worked out by the Government
and will be taken under its personal control.
- The government will
tackle the problems that were voiced by the participants of today's important
meeting. I believe we need a breakthrough in the decision-making process. As
the President of the country, I will closely follow the decision-making process
and the development of interaction with our major partners and friends, -
concluded Kassym-Jomart Tokayev.
During the first
session of the Working Meeting the following speakers spoke: President of the
European Bank for Reconstruction and Development Odile Renaud-Basso, KFICA
Governing Board Chairman, Managing Partner for Kazakhstan and Central Asia, EY
Erlan Dosymbekov, Vice-President for Private Sector Operations and Public–
Private Partnerships, Asian Development Bank Ashok Lavasa, EY Global Managing
Partner – Client Service Andy Baldwin, Chairman of Anadolu Group Tuncay
Ozilhan, Deputy Chairman of Baker McKenzie, Member of the Global Executive
Committee of Baker McKenzie Dr. Constanze Ulmer-Eilfort, Chief Executive
Officer for Citi Europe, Middle East and Africa David Livingstone, Chairman of
the Board of the Eurasian Development Bank Nikolay Podguzov, Chairman of the
Board of Directors of ERG Sarl Alexander Mashkevich, Vice-President of GE,
President and CEO of GE Russia/CIS Ron Pollett, Board Directors Chairman, JP
Morgan Chase International Jacob Frenkel, Member of the Board of Directors,
Vice Chairman of Marubeni Corporation Ichiro Takahara, President of Philip
Morris International at Eastern Europe Marco Mariotti, President Polymetal
Management Company JSC Igor Finogenov, Chief Executive Officer for PwC Nick
Kos, CEO, Chairman of the Executive Board of Sberbank of Russia Herman Gref,
World Bank Vice President for Europe and Central Asia Anna Bjerde.
During the session on
the development and increasing the investment attractiveness of the country's
oil and gas sector, the following speakers spoke: KFICA Governing Board Deputy
Chairman, Country Chair, Shell Kazakhstan Olivier Lazare, CEO, Royal Dutch Shel
Ben van Beurden, Eni Upstream Director Guido Brusco, President, Lukoil JSC
Vagit Alekperov, Executive Vice-President, Chevron James Johnson, President,
ExxonMobil Global Projects Company Neil W. Duffin, President, Vice-president
Caspian and Southern Europe, Total
Bernard Clement, Vice President, China National Petroleum Corporation
Huang Yongzhang, and also Minister of energy of the Republic of Kazakhstan
Nurlan Nogayev.
