How Almaty Region Plans to Attract New Business
Analysis
This year it is planned to open 100 new business facilities in the Almaty region, Kazakhstan, creating 12,000 jobs, a vital fact for one of the most densely populated regions of the country. Companies of various scale will be presented - from individual entrepreneurships of the local population to launching plants together with foreign partners. Let’s take a look at what can attract businessmen to open production in the territory of Almaty region and the costs.
Socio-economic development
In May, Kazakh President Nursultan Nazarbayev paid a working visit to the Almaty region to inspect facilities, meet with local entrepreneurs and to outline areas that should be developed. In general, Nazarbayev positively assessed the socio-economic situation in the region.
“The Almaty region, especially in the agrarian sector, is an example for all. The region's economy grew by 4.2%, which is higher than the national average. Agriculture and construction have grown and the volume of social facilities has increased,” he said.
According to the Department of Statistics, growth is noted for all indicators. In January-May this year, the volume of industrial production was 324.8 billion Tenge ($956,536,000.00 ), 104.4% compared to January-May 2017. The volume of gross output of agricultural products (services) for the first five months of this year amounted to 124.9 billion Tenge ($367,830,500.00 ), 103.2% compared to January-May 2017: including livestock - 117.9 billion Tenge ($347,215,500.00), crop production - 7 billion Tenge ($20,615,000.00), services in agriculture - 0.04 billion Tenge ($117,800.00). The volume of freight turnover amounted to 2.9 billion tkm (including an estimate of the volume of freight turnover of individual entrepreneurs involved in commercial transportation) and increased by 0.6% compared to January-May 2017.
During the first five months of this year, the region's enterprises mastered 144,238.4 million Tenge ($424.9524 ) of investments in fixed assets, which amounted to 100.5% to the volume of 2017. The main share is accounted for by private ownership (69.5%), foreign ownership (12.9%), state ownership (17.6%). The largest volumes of investments in fixed assets were mastered by industrial enterprises by 25.1%.
According to the Statistical Business Register, the largest number of operating individual entrepreneurs is concentrated in Almaty (13.9%), in South Kazakhstan (12.4%), in East Kazakhstan (7.8%), and Almaty areas (7.6%). At the same time, a significant number of operating peasant or farm enterprises were recorded in South Kazakhstan (36.3%) and Almaty regions (23.1%).
Infrastructure
The largest infrastructure project on the mechanism of public-private partnership - construction of the Big Almaty Ring Road (BAKAD) is being implemented on the territory of the Almaty region. The project cost is about 180 billion Tenge. The road will be open in 4 years.
“Completion of the BAKAD will give an impetus to the development of the region's economy, because it will attract about 300 billion Tenge of investment. This will give a multiplier effect for small and medium-sized businesses, the development of roadside service, transport and logistics terminals along it, and access to markets for industrial enterprises will improve, especially given that in this area we have developed tourism, especially in summer and winter sports,” said Governor of Almaty region, Amandyk Batalov, at the start of the project.
The road to the Kolsai Lakes has been restored, the capital repair of the Usharal-Dostyk road has begun, and it is planned to repair the road to Lake Balkhash.
Investments
According to Kazakh Invest, in Kazakhstan in 2018, together with municipalities and state agencies, 15 projects with the participation of foreign investments amounting to $1.6 billion will begin and 23 projects will be commissioned for $3 billion. In the context of the regions, the largest number of investment projects planned for commissioning are accounted for by the Almaty region - 5 projects worth $179 million.
Foreign investors are showing great interest in the Almaty region. The Russian company Lukoil intends to build a lubricant factory, the Italian Cremonini Group will start construction of meat-packing plant KAZAK-BEEF, Dutch company Farm Frites intends to build a potato processing plant, while German company Baumann is to implement a project in the meat industry.
Cooperation with companies from Switzerland, China, Poland has been established.
Prospective directions
The most promising areas in the Almaty region are agriculture (livestock, horticulture, vegetable growing) and the tourism industry. Also of interest there are the food and manufacturing industries.
By Dimitri Dolaberidze