IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Outflow (subsidised)

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
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Inception date: No inception date

Trade finance

On 6 April 2015 the Government of the President of the Republic of Kazakhstan issued Decree No. 1030. It has introduced the State Programme for Infrastructural Development 'Nurly Zhol' for 2015 -- 2019 (hereinafter referred to as "the Programme"). This report focuses on the industrial policy dimensions of this infrastructure programme. Since the Programme does not allocate concrete budget funds, but only projects them, it is classified by the GTA as amber, not implemented.
 
 
Industrial policy measures
Point 5.7 of the Decree State support for entrepreneurs 

In 2015, the National Fund is to allocate funds on advantageous terms to small and medium, as well as to big enterprises in the manufacturing sector. The interest rate is set at a maximumof 6% p.a.; the duration of any credits is at most 10 years. 
 
Points 5.9--5.11 of the Decree: Anti-crisis measures 
Point 5.9 of the Decree
Development of selected domestic mechanical engineering products (cars, helicopters "Eurocopter" and passenger cars "Tulpar Talgo") through leasing and credit financing, as follows:
 
Credit state support for purchases from domestic automakers
Credit contract maturity: 5 years
Credit interest rate: not more than 6% p.a.
Currency: tenge

Leasing support for domestic cars
Leasing contract maturity: 3--5 years
Leasing interest rate: not more than 4% p.a.
Currency: tenge

State support for leasing of helicopters 'Eurocopter'
Leasing contract maturity: 20 years
Leasing interest rate: not more than 4% p.a.
Currency: tenge

State support for purchases of passenger cars "Tulpar Talgo"
Credit contract maturity: 20 years
Credit interest rate: not more than 6% p.a.
Currency: tenge
State support for passenger cars "Tulpar Talgo"
Leasing contract maturity: 20 years
Leasing interest rate: not more than 4% p.a.
Currency: tenge
Import-substitution and increased trade competitiveness are indicated as motivation for these state measures.
 
Point 5.10 of the Decree
Pre-export and export funding

An explicit condition for state financing is export of domestically-produced goods and import of products for circulation in Kazakhstan (implicitly meaning, not mentioned in the Decree, that they may be be used for pre-exports). The state is to support exporters with credits with the following conditions:
Credit contract maturity: 20 years
Nominal interest rate: not more than 6% p.a.
Currency: tenge or other currency
 
Point 5.11 of the Decree
State support for agricultural producers

The state is to support agro-producers with subsidised/reimbursed interest rates on loans and lease obligations. As target goods are mentioned eggs, milk, meat, as well as lifestock.
 
Concrete budget allocations
The National Fund is to support small and medium entrepreneurs (SMEs) with 50 billion tenge in 2015, and big enterprises with 50 billion tengein 2015 (ca. 270 million USD each of them). There are no explicit restrictions in terms ofmanufacturing sub-sectors of the economy in which the SMEs should operate. However, it may be expected that priority will be given to SMEs that operate in the manufacturing sub-sectors from the list of sectors that were defined as strategic in Decree No. 301 of 13 April 2010 of the Government of the Republic of Kazakhstan.
 
The National Fund is to finance the anti-crisis measures in 2015 and 2016 as follows:

  • for development of the domestic mechanical engineering - 35 billion tenge (ca. 189 million USD), distributed as follows:
    • car production -- 20 billion tenge;
    • production of helicopters -- 10 billion tenge;
    • production of passenger cars -- 5 billion tenge;

 

  • pre-export and export funding -- 35 billion tenge (ca. 189 million USD) in 2015 and 15 billion tenge (ca. 81 million USD) in 2016
  • state support for agro-producers in 2015 -- 20 billion tenge (ca. 108 million USD), distributed as follows:
    • subsidised interest rates on loans and lease obligations in the framework of the financial recovery of agribusiness entities -- 7 billion tenge;
    • reimbursement of interest rates on credits (leasing) for support of agriculture -- 1.5 billion tenge;
    • development of livestock breeding, increasing the productivity and quality of livestock products -- 11.5 billion tenge.

 
The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets, and from foreign subsidiaries.

AFFECTED COUNTRIES

MAP
TABLE
EXPORT

AFFECTED SECTORS AND PRODUCTS

211 Meat & meat products
0201 Meat of bovine animals, fresh or chilled.
020110 Carcasses and halfcarcasses
0207 Meat and edible offal, of the poultry of heading 01.05, fresh, chilled or frozen.
020712 Not cut in pieces, frozen
020714 Cuts and offal, frozen
020727 Cuts and offal, frozen
221 Processed liquid milk, cream & whey
0401 Milk and cream, not concentrated nor containing added sugar or other sweetening matter.
040120 Of a fat content, by weight, exceeding 1 % but not exceeding 6 %
222 Other dairy products
0403 Buttermilk, curdled milk and cream, yogurt, kephir and other fermented or acidified milk and cream, whether or not concentrated or containing added sugar or other sweetening matter or flavoured or containing added fruit, nuts or cocoa.
040390 Other
491 Motor vehicles, trailers & semi-trailers; parts
8704 Motor vehicles for the transport of goods.
870422 g.v.w. exceeding 5 tonnes but not exceeding 20 tonnes
870423 g.v.w. exceeding 20 tonnes

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