Investment opportunities in Kazakhstan: which sectors are most attractive to foreign investors?
Most major rating agencies keep indicating the credit rating of Kazakhstan as stable. This positive outlook is the result of the measures taken by the Kazakh government on economic stabilization. The Kazakh government approved a comprehensive plan for the restoration of economic growth. It includes tax incentives and expansion of the loan issuance, as well as measures to develop infrastructure and domestic production. The comprehensive plan also includes the measures to support the entrepreneurship and preserve the employment. All of this will help Kazakhstan not to lose its investment attractiveness to foreign entrepreneurs. The intensive work with the strategic investors is a priority outlined by President of Kazakhstan Kassym-Jomart Tokayev.
Kazakhstan’s investment potential was recently presented in Norway, Kazakh Foreign Ministry’s press office reported. The business seminar was attended by representatives of the commercial enterprises of Innlandet county. Businesses were told about the conditions for doing business in Kazakhstan, the existing preferences and advantages of the Astana International Financial Center.
Among those who showed their interest in working with the Kazakh companies are the Norwegian companies producing snow removal equipment, external electric batteries, as well as the tourist infrastructure construction company. The agreement to continue the dialogue on promising and mutually beneficial areas was reached.
The German business sector is also willing to cooperate with Kazakhstan. Germany, as before, considers the cooperation with Kazakhstan as one of the priority areas in its foreign economic activity. This was discussed at the 29th meeting of the Berlin Eurasian Club.
Experts say that the great prospects for German investment lay in the agricultural sector of Kazakhstan. Parliamentary State Secretary at the Federal Ministry of Food and Agriculture of the Federal Republic of Germany Uwe Feiler gave a positive assessment to the development of the agro-industrial complex and the quality of Kazakh agricultural products.
To implement projects in the agricultural sector, Kazakhstan is ready to provide individual support measures to German investors. For these purposes, the government working group was created. It will be promptly and legally promoting the implementation of joint investment projects. In addition, the potential partners are offered subsidies, soft loans and special taxation regimes.
Experts say that according to the statistics for 2019, the mining sector remains the most attractive sector for investors. This industry attracted a record amount of foreign investment over the past 12 months, which reached US$13.5 billion. The manufacturing industry and trade are also in the top three of the most attractive sectors for investors. The manufacturing industry attracted US$3.5 billion of investment and trade US$3 billion, respectively.
As for the mining industry in Kazakhstan, an influx of foreign investment is observed in ore mining.
As it recently came to light, a Russian investor will invest more than US$100 million in the development of the production of rare metals in Kazakhstan. The money is planned to be allocated to modernize the Yertys Chemical and Metallurgical Plant located in Pervomaika village in the East Kazakhstan region. According to the ‘Kazakh Invest’ national company, more than US$10 million have already been invested in the enterprise modernization. The reconstruction of individual sections has already been completed, and the work to improve the production and organization of the deep processing of rare metals, including titanium and niobium, have been carried out.
“20 tons of high-purity titanium were produced and are ready for shipment for export. We have export contracts with Japan and European countries. The first export of four ingots of high-purity niobium was sent to the Russian Federation. In addition to the production of titanium and niobium ingots, we plan to build three more workshops – forging, sheet rolling, on which thin sheets of titanium, zirconium and niobium will be produced. And a pipe-rolling workshop, where it is planned to produce pipes with a diameter of 10 to 15 millimeters and a wall thickness of 0.5 millimeters from titanium, zirconium and niobium,” said a Russian investor Victor Popov.
According to the ‘Kazakh Invest’ national company, since the beginning of the year, seven investment projects worth US$420 million were implemented in Kazakhstan. By the end of 2020, it is planned to implement another 33 projects worth nearly US$4 billion.