Kazakhstan’s attractiveness for foreign investors:current status

National Export & Investment Agency “KAZNEX INVEST” Ministry of Investment and Development

0

4

8

12

16

2018.118.8

8.4

2014f0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.013.5

5.2

2014f

0.02.04.06.08.0

10.012.014.016.0

1.1

13.0

2014f

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

0.0

50.0

100.0

150.0

200.0

250.0

16.9

225.6

2014f

GDP per capita (ths.USD)GDP (bln.USD)

Inflation (%)

Gross International Reserves and Assets of the National Fund of RK

(bln.USD)

Free exchange

Unemployment rate from 1999 to 2013 decreased by 8%

Inflation from 1999 to 2013 decreased by 13%

0.0

20.0

40.0

60.0

80.0

100.0

120.0

2.0

95.5

Unemployment rate (%)

0.0

5.0

10.0

15.0

20.0

25.0

14.6

22.7Birth rate (per 1000 people)

0

100

200

300

400

500

600

700

800

99

717

GDP from 1999 to 2013 increased by 14 times

GDP per capita from 1999 to 2013 increased by 12 times

02468

1012141618

17.1

2.6

Government External Debt to GDP (%)

Government External Debt decreased by 14%

Exchange rate regime - floating

The total amount of gross FDI from 2005 to 2013 amounted to $184 billion.

Herewith, the average annual growth rate of gross FDI is 17.4%.

Average monthly nominal wage increased by 7.2 times

Stable macroeconomic indicators and high growth

Source: National Bank of the RK, Committee on Statistics of the Ministry of National Economy of the RK, IMF

GDP growth (%)

Average monthly nominal wage (USD)

0.02.04.06.08.0

10.012.014.016.0

2.7 4.6

2014f

Metallurgical Complex1

1. Ferrous metallurgy

2. Non-ferrous metallurgy

3. Oil refining4. Petrochemistry

5. Manufacture of food products

8. Manufacture of motor vehicles

9. Electrical equipment10. Agricultural

machinery engineering

11. Railway machinery engineering

12. Mining equipment13. Oil producing

equipment; oil and gas refining equipment

6. Agrochemistry 7. Production of

chemicals for industry

14. Production of construction materials

Oil refining Complex

2 Food processing Industry3

Chemical Industry4 Industrial

Production5

Production of construction materials

6

Priority sectors

SEZ

SEZ

SEZ

SEZ

SEZ

SEZ

SEZ

SEZ

SEZSEZ

Customs privileges

Customs duties 0% on the import of:• equipment and its components,• spare parts, • raw materials and supplies.

State in-kind grants

Land plots, buildings, machinery and equipment in property.

Tax benefits•CIT – 0 % 10 years•Land tax – 0% 10 years•Property tax– 0% 8 years

Investment reimbursemen

tUp to 30% of construction and installation works and equipment

Providing the land in the territory of the SEZ for a period of up to 10 years

Tax benefits

CIT – 0%Land tax– 0%Property tax– 0%VAT – 0% (on all goods completely consumed in the production process)

Exemption from customs dutiesfor  goods imported into SEZ territory

Customs privileges

Simplified procedure for recruiting foreign workers

Other privileges

The "one window" principle for the investor and service support for investment

Information, consulting, organizational and

other assistance to the investor

Assistance in obtaining the required approvals

and permits

Support for investment project till the start of

the production

Provision of services to foreign investors and

representatives of Kazakhstan business

Migration benefits

The right to employ foreign labor without quotas and permitsVisa-free travel for citizens of 10 countries

INVESTMENT PREFERENCES*

Support for investors SPECIAL ECONOMIC ZONES

*for priority investment projectsPriority types of activities:

1. Metallurgy2. Oil refining3. Food production4. Chemical industry5. Machinery industry6. Production of construction materials

SPECIAL ECONOMIC ZONES (10 ZONES)

SEZ «Pavlodar» Petrochemistry

SEZ «NIPT» Petrochemistry

SEZ «Saryarka» Metalurgy

SEZ «Seaport Aktau» Mixed

SEZ «Burabai»Tourism

SEZ «Ontustik» Textiles

SEZ «Astana New city»

Mixed

SEZ «Chemical Park Taraz»

Chemistry

SEZ «Khorgos – Eastern Gate» Logistics

SEZ «Park of Innovative Technologies» IT - Innovations

Investment

RUSSIAN FEDERATION143.5 mln.

UZBEKISTAN

30.2 mln.

TURKMENISTAN5.2 mln.

KAZAKHSTAN17 mln.

Western Europe – Western China corridor on the territory of Kazakhstan (2,787 km)

PEOPLE’S REPUBLIC OF CHINA1.4 bln.

MONGOLIA2.8 mln.

INDIA1.3 bln.

BELARUS9.5 mln.

IRAN77.4 mln.

PAKISTAN182.1 mln.

TURKEY74.9 mln.

Western Europe – Western China corridor (8,445 km)

Lianyungang

St. Petersburg

Aktobe

Shymkent

KYRGYZSTAN5.7 mln.

LOCATION AND INFRASTRUCTURE

Infrastructure

• The Kazakhstan’s geographical position makes it a natural crossroads for major transit corridors from Asia to Europe.

• The transcontinental automobile road corridor “Western Europe – Western China” passes through the territory of Kazakhstan. The corridor will allow to deliver freights from China to Europe in 10 days.

• There is a territory with population of more than 3.3 bln. people within a radius of 2 thsd. km from Kazakhstan

• The flight time from most European destinations is five hours.

Economy

0.3 0.7 1.1 2.1 1.8 2.2

5.73.5 2.5 1.5

7.9

12.1

19.421.3 21.4 22.2

26.528.9

24.0

12.4

2005 2006 2007 2008 2009 2010 2011 2012 2013 1H 2014

Manufacturing industry Total

FDI in the manufacturing sector 15.4 $ bln.

72%

FDI in the manufacturing sector 6.1 $ bln.

28 %

Source: National Bank of the RK

FDI ATTRACTION

Economy

Source: National Bank of the RK

CUMULATIVE FDI INFLOW BY COUNTRIES 2005 – 1H 2014Main countries USD: 149.2 billionTotal USD: 196.1 billiion

Belgi

um

Liber

ia

Japa

nIta

ly

Russian

Fed

erat

ion

Virgin

Isla

nds (

British)

Unite

d Kin

gdom

Fran

ce

China

Switz

erla

nd USA

Nethe

rland

s0.0

10.0

20.0

30.0

40.0

50.0

60.0

3.11.7%

4.32.3%

4.32.3%

5.22.8%

7.94.3%

9.65.2%

10.55.7%

10.65.8%

11.26.1%

11.46.2%

17.99.7%

53.228.9%

• SKD assembly of motor vehicles

• CKD assembly of motor vehicles

Production of car parts and accessories :

Manufacture of electric motors, increasing localization:

Production of locomotives and wagons:

Production of equipment:

Production of helicopters: Production of combines and tractors:

Production of equipment:

Railway Machinery

Automobile Production

Machinery for Mining

Aviation Machinery

Machinery

Chemical Industry The production of chemical additives, sodium hexametaphosphate industrial gases, sulphuric acid, ammonia and ammonium nitrate:

The production of ethanol based on the processing of the industrial gases, the production of bioethanol from spent grain, mixing special chemicals for oil extraction and refining:

Professional training, production of generic products: Professional training, production of generics and original medicines:

Pharmaceutical Industry

Industries2010-2014 2015-2019

Organization of business forums (road

show)

Provision of information about

business/investment projects and

analytical information

1

Foreign investors support

in regions

Support of the National

Investment Interactive

Internet Resource www.invest.gov.kz

Support of the Investment

Projects Databasewww.baseinvest.kz

Assistance in obtaining

state support for investors

2 3

4 5 6

Assistance to foreign investors

Thank you for your attention

National Export & Investment Agency “KAZNEX INVEST” Ministry of Investment and Development