Welcome to Kazakhstan

General information

Investment climate in Kazakhstan

Kazakhstan as a country leading the region in terms of social and economic growth could play a key role in the region turning Central Asia into a credible and independent region and part of a civilised and prosperous world. It could drive and facilitate a dialogue with multinational corporations and get international investors to develop the entire Central Asian region.

In October 2000 the European Union raised

Kazakhstan

to the status of the market economy.

On 26 March 2002 the U.S. administration represented by the Department of Commerce decided to withdraw the status of non-market economy from Kazakhstan under U.S. Anti-Dumping Act. Based on the analysis of such indicators as convertibility of national currency, free level of wage, foreign investment, public

control, control of production, corruption and barter business, human rights etc. the U.S. Department of Commerce raised Kazakhstan’s status to market economy. This conclusion will be applied to all current and future administrative procedures.

That happened due to a constructive cooperation between the Kazakh government and the

U.S.

administration, as well as successful social and economic reform undertaken in the country. It is a very important decision; it opens up

U.S.

and Western markets.

Upgrading export credit rating to 4 in 2003 by OECD, which is an organisation of about 40 industrial countries of the world, is significant as it provides

Kazakhstan

with better opportunities for trade. It should be noted that the upgraded Kazakhstan ’s export credit rating was driven largely by visit of Mr. Philip Merill, Chairman of US Eximbank paid to

Kazakhstan

. He was very optimistic about the country’s economic and investment achievements.

Kazakhstan is by right considered the leading CIS country in terms of environment best enabling investment, which is evidenced by the fact that Kazakhstan was the first CIS country that received investment rating from international rating agency Moody’s in 2002 and later in 2004 from Standard & Poor’s and Fitch, and by the findings of surveys conducted by other international experts and international organisations.

In their report Fitch analysts noted that

Kazakhstan

’s economy and public finance were the most steady to handle oil pressure and volatile oil prices in the world markets.

According to the World Bank’s Business in 2005: Eliminating Constraints to Growth annual report on status and freedom of entrepreneurship in 145 countries worldwide Kazakhstan is in the 5^th group (countries are scored 0 to 7, where 7 is the best index – Canada and US) with such countries as Germany, Denmark, New Zealand, Switzerland, Singapore and Georgia that is the best result in CIS. We intend to make further efforts to be ranked higher in the list.

According to experts' estimates over eighty percent of all direct investment in Central Asia was made in

Kazakhstan

. The World Bank ranked our country as one of the twenty countries in the world most attractive to investors.

In the past few years

Kazakhstan

has been ranking the first in CIS in terms of foreign direct investment per capita. Between 1993 and the first half of 2005 FDI in

Kazakhstan

has reached almost 37.2 billion US Dollars. It’s worth noting that between 2001 and 2003 FDI worth 4 to 4.5 bn US Dollars per annum and 8.4 bn US Dollars in 2004 have been made in

Kazakhstan

. Foreign investors are becoming increasingly interested in the Kazakh market. Therefore there were 7,070 companies with foreign involvement in 2004 versus 6,579 in 2003 and 1,865 in 1999.

The above figures make it possible to describe

Kazakhstan

’s investment environment as liberal one enabling foreign investors to operate virtually in all sectors.

Laws passed and steps taken contributed to enhancing the country’s investment image and, accordingly, to inflow of foreign investment in its economy. As a result,

Kazakhstan

has been leading CIS for a number of years in terms of FDI per capita and was the first CIS country that received investment rating from international rating agencies.

In January 2003 the Kazakh Law On Investment was passed based on the two previous laws. First of all this law provides for equality of investment incentives to foreign and local investors, protection of investors’ rights and procedure for settling investors' disputes.

As part of efforts to establish petrochemical facilities in Kazakhstan , which is now one of the priority sectors, it is planned to build a petrochemical plant to produce polyethylene and polypropylene in the west of

Kazakhstan

. The project is being prepared by local firm Sat&Co that is negotiating the involvement of the world’s largest producer of polyethylene and polypropylene – BASELL. (See Information about status of petrochemical industry in

Kazakhstan

It is planned to implement a number of investment projects in association with the government development institutions. For instance, JSC Kazakhstan Investment Fund reached an agreement with Pilkington Firm of

, which is one of the world’s largest producers of glass plates on joint implementation of the project for building a plant to produce glass plates in Kyzylorda Region.

There are lots of similar projects. Investment projects socially and economically significant to both individual regions and the country as a whole are now either being implemented or expected to be implemented in all areas in

Kazakhstan

Committee on Investments, Ministry of Industry and Trade of the Republic of Kazakhstan