Dear participants of the meeting!
I am glad to greet you at the next annual meeting.
It is significant that our meeting is taking place on the eve of the 20th anniversary of our capital Astana, and I would like to take this opportunity to congratulate you on the coming anniversary.
Today I want to tell you about the main results of the activities of the Ministry of National Economy for 2017 and about the tasks for the current year.
Our Ministry, as the coordinator of socio-economic policy, ensures the integrity and efficiency of the national economy in order to improve the quality of life and the well-being of the population.
Last year, the Ministry continued to implement Strategy 2050, 5 institutional reforms and instructions of the Head of State to ensure sustainable economic growth.
1. The state of Kazakhstan's economy in 2017
The economic development of our republic has passed the adaptation period to new realities, and outstripped the world average growth rates, amounting to 4%.
I want to note structural changes in the economy - two-thirds (three-thirds) of growth is provided by the non-primary sector.
In 2017, almost all sub-sectors of the economy showed positive growth. Of the key 32 industries in the negative zone was only 1 industry (rubber and plastic production fell by 0.2%), whereas in 2016 there were 10 industries in the red.
A favorable macroeconomic background played a key role in growth, accompanied by a slowdown in inflation to 7.1% against the peak of 13.6% in 2015.
Also, the positive effect was the implementation of strategic documents and government programs.
I want to dwell more on state programs.
According to the Map of Industrialization in 2017, 120 projects were put in the amount of about 1.5 trillion. tenge. Created 10 thousand permanent jobs.
Within the framework of Nurly Jol, over 4,000 km of roads were covered by the reconstruction, transit container transportation increased by 30%.
Last year the program "Nurly Zher" was launched. In total, a record 11.2 million square meters were commissioned meters of housing (6.2% by 2016), more than 100 thousand families received new housing.
According to the state program for the development of the agro-industrial complex, 851 cooperatives were formed over the past year, 132,000 tons of milk and 33,000 tons of fruit and vegetable products were harvested.
Within the framework of the Business Road Map, credits for KZT 286 billion were cheaper and guaranteed, 23 thousand entrepreneurs were trained. In total, 192,000 business entities received support, or 10.3% more than in 2016.
Under the Program for the Development of Productive Employment and Mass Entrepreneurship, 500,000 citizens are supported, of which 315,000 are employed for permanent jobs.
In 2017, the National Export Strategy was launched, covering measures to support 400 exporting producers (every fourth exporter) for KZT 50 billion.
Evidence of positive changes in 2017 was the confirmation of the level of Kazakhstan's investment reliability by international rating agencies and the improvement of the forecast from "Negative" to "Stable".
According to the results of the 2018 survey, Kazakhstan ranked 38th in the World Competitiveness Ranking (International Institute for Management Development - IMD) (47th in 2016 and 32nd in 2017).
Also, in the rating of the Global Competitiveness Index (GEF VEF), Kazakhstan is ranked 57th out of 137 countries.
These are the results of Kazakhstan's economic development, I will now focus on the core activities of the Ministry of National Economy in 2017 and tasks for the current year.
1) Adoption and implementation of the Strategic Plan until 2025
One of the most important tasks of the Ministry last year was the development of a large-scale document - the Strategic Development Plan of the Republic of Kazakhstan until 2025. The strategic plan until 2025 starts the processes of the Third Modernization of the country, announced by the Head of State in the Address to the people of Kazakhstan.
The main goal until 2025 is to achieve a qualitative and sustainable economic recovery leading to an increase in people's well-being at the level of the OECD countries.
To achieve this goal, it is necessary to ensure the average annual growth of the economy at 4.5-5.0% and bring GDP per capita to $ 46.1 thousand (at purchasing power parity).
Within the framework of the Strategic Plan, up to 2025, 7 systemic reforms are envisaged. It:
8. Development of human capital for sustainable growth;
9. Technological modernization of industries using industry technologies 4.0, the digitalization of the economy and the creation of an innovation infrastructure;
10. Activization of the private sector through the development of a competitive environment and export potential;
11. Creating a favorable socio-economic climate through compliance with laws, preventing corruption and developing legal culture;
12. Reducing the socio-economic gap between regions while ensuring a basic level of quality of life;
13. Formation of a united nation of strong and devoted people, increasing personal competitiveness and pragmatism of citizens;
14. Increasing the role of central state and local executive bodies, and organizations as agents of change in the country.
This is a big task, requiring coordinated actions of central and local executive bodies, as well as the business environment.
At present, the Ministry is working on bringing the existing strategic and program documents in line with the priorities of the Strategic Plan.
2) Ensuring macroeconomic stability
The key task of the Ministry is to ensure macroeconomic stability. To this end, a set of tasks has been implemented to regulate inflation processes and strengthen the sustainability of public finances.
In order to prevent price collusion and unjustified growth, constant monitoring and analysis of commodity markets for socially important goods is carried out. As a result of this work, appropriate response measures were taken within the framework of the antimonopoly legislation.
Within the framework of the Law of the Republic of Kazakhstan "On the regulation of trade activities", for each quarter threshold values of retail prices for socially important food products and the amount of maximum permissible retail prices on the territory of the region, cities of republican significance are set.
To strengthen the sustainability of public finances in 2017, the implementation of the new Concept for the Formation and Use of National Fund Funds began, according to which the deficit (up to 1.5% of GDP in 2018) will be reduced almost threefold and the guaranteed transfer from the National Fund (by 280 billion ., KZT).
Amendments to the budget legislation have been made. The amendments are aimed at more rapid delivery of public funds to the economy, a reduction in the non-use of budget funds and an increase in the number of PPP projects.
In order to increase the financial independence of the regions and involve the civilian population in solving local problems, the 4th level budgets were introduced. The receipt of taxes in the budgets of villages, towns and rural districts and the independent determination of the priority of their expenditure is one of the stimulating factors for activating activities at the level of the M & E. This ensures equal fiscal opportunities for the regions in providing the public with budgetary services guaranteed by the Constitution of the Republic of Kazakhstan and legislation.
Legislative changes have been adopted providing for monitoring and monitoring of external and internal loans of the quasi-public sector.
In 2017, new Tax and Customs Codes were adopted.
The new Tax Code came into force on January 1, 2018.
Beginning with the independence of the republic, this is the third generation of the Tax Code. The first Code was adopted in 2001. The second in 8 years, in 2009. And after 9 years - the new Tax Code.
Reduced fines (for understatement of advance payments from 40% to 20%). The grounds for tax inspections have been reduced. There are incentives in electronic commerce, automotive, geological exploration, raw material processing and investment attraction. Tax procedures for SMEs and agribusiness were simplified.
The ideology has been changed - it is aimed at protecting honest business and simplified administration.
The tax reform carried out will allow increasing receipts to the budget in the amount of KZT 653 billion by 2025, attracting 4.1 trillion rubles to the economy. tenge of investments, create over 7 thousand jobs.
The Customs Code of the Republic of Kazakhstan, which came into force also from January 1, 2018, in addition to the implementation of the norms of the Customs Code of the Unified Energy System, is aimed at stimulating foreign trade activities, simplifying trade procedures and reducing administrative barriers, and developing transit potential.
It also provides for reducing the burden on entrepreneurs, for example, by reducing the limitation period for SMEs to 3 years, by expanding the list of grounds for voluntary recognition of the error.
3) Development of entrepreneurship
In 2017, for further deregulation of the business, systematic measures were taken to:
- reforming the state control and supervisory activities;
- the regulation of information tools;
- reforming permits granted by monopolists and subjects of the quasi-public sector;
- frontal decline of all types of business costs.
All of them formed the basis, signed by the Head of State, the Law on Improving Regulation of Entrepreneurship.
According to the Law, state control functions have been reduced by almost 30%.
In particular, due to duplication and lack of efficiency, the following have been reduced:
- 20 areas of control and supervision out of 114;
- 108 control functions of state bodies that are not related to the risks of security threats to the state and the consumer, out of 544;
- from 30 to 15 working days - the timing of inspections under a special order;
- from 30 to 10 working days - unscheduled inspections.
In the sphere of sanitary and epidemiological well-being, the number of claims has been reduced by 85% and by 72% - requirements in the field of fire safety (sanitary and medical checks of business have been reduced by 1.7 times, 34.5 thousand SME subjects have been exempt from sanitary inspections).
More than 1,600 information requirements to business were revealed, some of which are duplicated and is not relevant. In this regard, all information tools and the order of their presentation are clearly regulated, and their number will be reduced by 30% by the end of the year.
In the future, we plan to work out the possibility of automating the processes of their provision.
For the first time, the issue of rendering obligatory services by subjects of natural monopolies and quasi-public sector (issuance of documents that are permissive in nature) for individuals and legal entities was legislatively regulated.
A ban on coordinating the activity of procurement suppliers, bidders, was introduced if these actions lead or may lead to the prevention, restriction or elimination of competition. For violation of this prohibition, a fine of 100 MCI is provided, for repeated violation within a year, 150 MCI.
Within the framework of the Law, a package of legislative initiatives has been implemented to achieve the goal of entering the first
30 countries in the World Bank's "Doing Business" rating. In particular:
- bans were imposed on state bodies and financial organizations to print on documents of private entrepreneurs;
- simplified the procedure for issuing a certificate of origin of goods when exporting;
- introduced a factoring and financial leasing instrument for bankruptcy and rehabilitation procedures.
In general, the implementation of the Law will improve the conditions for the legal regulation of entrepreneurial activities and reduce the administrative burden and costs of entrepreneurs.
4) Development of public-private partnerships
To attract additional investments in the economy, the Ministry carried out measures to develop PPP tools.
In 2017, new standard documentation for kindergartens, dormitories, a polyclinic, family-doctor outpatient clinics, street lighting, housing and communal services were introduced. This allowed using PPPs to conclude 172 contracts for 193.4 billion tenge. This is 8 times more than in all previous years.
I want to mention three major republican projects. This is the construction of a car checkpoint "Nur-zholy" in the amount of 98 billion tenge. Under this project, the PPP contract was concluded in December 2017.
At the beginning of this year, agreements were concluded on the concession project "Construction and operation of the highway" Big Almaty Ring Road (BAKAD) "worth 512 billion tenge and the PPP project" Creation, implementation and operation of the automated information system "Kundelik" for the amount of 5, 8 billion tenge. Currently, these projects are under implementation.
To accelerate the attraction of investments in social infrastructure, at the end of last year the procedures were simplified: the stages were reduced from 5 to 3, and the terms of contracting from 7 to 3 months.
The possibility of planning standardized (homogeneous) PPP projects taking into account the specifics of the industry within the framework of state programs has been introduced.
To ensure the availability of PPPs for business, a simplified scheme has been introduced on the principle of "program PPP", and a single information base for PPP projects has been launched.
To promote the improvement of the work of PPP, a Commission on Concession Projects of Special Importance has been established, as well as amendments to the Rules for the Planning and Implementation of PPP Projects and Concession Projects.
5) Reduction of state participation in the economy
In order to achieve the goal of reducing the state's share in the economy to 15% and expanding the contribution of the private sector to the country's economy, a Comprehensive Privatization Plan for 2016-2020 is being implemented.
As of June 1, 2018, the Comprehensive Privatization Plan contains 881 organizations, 482 of them have been put up, 411 objects have been sold for a total of 210.2 billion tenge.
Thus, these objects went into private hands.
6) Development of regions
The Ministry implemented a set of measures to increase the competitiveness of the regions, the development of economic growth centers, promising mono- and small towns and villages, including supporting rural and border settlements.
To ensure the country's managed urbanization, from 2016 to 2018, the Interregional schemes for the territorial development of the Almaty, Astana, Shymkent and Aktyubinsk agglomerations were adopted.
In 2017, the concept "SmartCity" was launched in the centers of agglomerations in the framework of the state program "Digital Kazakhstan".
With the purpose of increasing the economic potential of villages, as well as ensuring the participation of the rural population in the distribution of budgetary funds, an independent budget and municipal property of local self-government are being introduced in the years 2018-2020.
During the implementation of the project "With a diploma in the village," social support was provided to over 54,000 specialists who received an allowance in the amount of KZT 12.5 billion, and about 23.5 thousand specialists received budget loans for housing in the amount of 57.0 billion tenge.
In 2017, within the framework of the Program for the Development of Regions until 2020, 30 projects on the rational development and development of towns and villages were implemented for 18.4 billion tenge.
164 budget investment projects on the development of water supply and sanitation (for the amount of 55.8 billion tenge at the expense of the republican budget) were implemented, including:
- To cities 30 projects (by 20.7 billion tenge);
- rural settlements - 134 projects
(by 35.1 billion tenge).
As a result, access to centralized water supply in cities increased from 88% in 2016 to 93.8% in 2017, in rural areas from 52.3% to 57.4%.
17 projects on construction and reconstruction of group conduits were realized for 11.1 billion tenge.
7) International economic cooperation
In order to deepen integration into the world economic space and expand its export potential, systematic work is carried out within the WTO, OECD and the EEA.
Within the framework of the WTO in 2017, more than 50 notifications were considered and sent, and 25 international rules were drafted in coordination with internal Kazakh standards.
Within the framework of the EAPS in 2017 a number of important documents were adopted. Among them, the main directions for the implementation of the digital agenda of the EAEC until 2025, the Roadmap for the elimination of exemptions and restrictions on the internal market of the EAPS for 2018-2019. and etc.
Also ratified and since January 1 this year. The new Customs Code of the EAEC entered into force, in which the current customs legislation is codified and codified.
This year, the Agreement on the facilitation of the terms of trade with Iran and China was signed, and the Agreement on trade and economic cooperation with Moldova and Croatia was also signed.
Integration measures yield positive results, which is confirmed by the reporting data.
In 2017, Kazakhstan's trade with the EEA countries increased by 25.9% to $ 17.3 billion, including exports - by 30.2%.
Direct foreign investment from the EEA countries to Kazakhstan grew by 42%.
Since the functioning of the Union in Kazakhstan, the number of joint ventures has increased 1.5 times. In total, 9.9 thousand joint ventures with the EEA countries operate on the territory of Kazakhstan as of May 1, 2018.
Within the framework of international cooperation, the Framework Agreement on Partnership with the leading international financial organizations - the World Bank Group, the European Bank for Reconstruction and Development, the Asian Development Bank and the Islamic Development Bank, the European Investment Bank - was signed on the initiative of the Head of State.
Today, 25 investment and institutional projects amounting to $ 2.1 billion are being implemented with the participation of international financial organizations. The share of attracted funds from international financial organizations amounted to 76.2%.
Projects are implemented in such priority areas as SME support, construction and reconstruction of roads, modernization of municipal infrastructure, development of agriculture and green economy, social modernization, etc.
In order to continue effective cooperation, it was decided to extend the Framework Partnership Agreements until 2020.
In 2017, a national roadmap for the implementation of OECD recommendations was approved. In the past year, the OECD has approved the extension of the implementation of the Country Program of Cooperation with Kazakhstan by the end of 2018.
In recognition of and trust from the OECD, the first visiting session of the OECD 2017 Eurasian Week was held in Almaty from October 23 to October 25.
2. Tasks of the Ministry for 2018
Let me inform you about the tasks of the Ministry for the current year. Thus, the work of the Ministry will focus on the following areas.
1) Ensuring macroeconomic stability and sustainable economic growth
The Ministry will direct work on strengthening inter-sectoral coordination to ensure the progressive development of the country's economy.
Effective fiscal policy will be pursued to maintain the sustainability of public finances with a flexible and favorable tax environment.
As part of the further development of the tax legislation, issues will be considered to regulate the taxation of self-employed persons and reform of the individual income tax.
Fiscal decentralization will continue with the strengthening of the revenue side of the local budget, and approaches will be developed to transfer the revenues of CIT from SMEs to the local level.
To effectively manage the debt this year, the limit amounts of the external debt of the quasi-public sector for 2018 and 2019 and the debt limits of the MIO for 2019 will be determined.
Changes will be made to the concept of the National Fund in terms of eliminating domestic debt.
Also in the implementation of the activities of the second initiative of the President, the Ministry plans to reduce the tax burden to increase the wages of low-paid workers. So, from January 1, 2019, the taxable income of employees with a salary of up to 25 MCI will decrease by 90%. The remaining salary will be taxed by the PIT at a rate of 10%. Thus, the tax burden is reduced by 10 times.
The mechanism assumes an instant and guaranteed receipt by the employee of additional income (at the time of receiving the basic salary) without increasing the financial burden on the employer.
Corresponding amendments to the tax legislation are included in the bill on social security issues, approved on May 23, 2018 by the Majilis of the Parliament and sent to the Senate for consideration.
2) Development of entrepreneurship
In the current year, work will continue to involve the population in entrepreneurial activities.
At the expense of tools and new initiatives, more than 150,000 entrepreneurs will be covered in the "RMB-2020" program, including about 16,000 people trained in the basics of entrepreneurship.
Within the framework of the RMB-2020, amendments will be made to the NAP related to the full automation of state support measures and financing of non-financial support through targeted transfers to the budgets of oblasts, Astana and Almaty cities.
A new package of systemic measures will be prepared to improve the business climate at the regional level and stimulate the withdrawal of business from the "shadow".
The rating of regions and cities will continue to be conducted in terms of ease of doing business and awarding a special award based on its results.
3) Development of competition and private capital
In order to increase the efficiency of the activities of natural monopoly entities, the quality and reliability of the services they provide, the Law of the Republic of Kazakhstan "On Natural Monopolies" and corresponding by-laws will be adopted.
To automate the process of applying for approval of tariffs for natural monopolists, the Monopolist Base will be developed and introduced.
4) Reduction of state participation in the economy
As part of the Comprehensive Privatization Plan, the completion of the sale of facilities under the Comprehensive Privatization Plan is expected in 2018, with the exception of the seven largest companies of the Samruk-Kazyna Fund, the implementation of which requires thorough and detailed preparation. These are KTZ, Kazatomprom, Samruk-Energo, Kazakhtelecom which are planned to be implemented by withdrawal to IPO / SPO in 2019-2020.
The expected revenue from the privatization of state property and the sale of assets that form part of the national managing holdings ranges from 4 to 7 billion US dollars.
5) Development of PPPs
In order to plan a larger number of PPP projects by local executive bodies, the Ministry, in cooperation with interested state bodies,
- a question on actualization of a technique of definition of limits of the state obligations;
- approval of the limits for the acceptance of IOI obligations for PPP projects for 2018-2020;
- the issue of recognizing guaranteed payments from the budget in the framework of PPP contracts as a pledge, to protect the rights of creditors;
- list of PPPs.
The main results of this work should be the activation of the application of PPP mechanisms in the regions and the increase in the number of contracts concluded, from 183 to 250.
The implementation of the Program for the Development of Regions until 2020 continues.
Within the framework of the program, 343 budget investment projects on development of water supply and water disposal for the amount of 93.4 billion tenge (funds of the republican budget) will be implemented, including:
- cities 24.8 billion tenge for the implementation of 58 projects;
- rural settlements - 68.6 billion tenge for the implementation of 285 projects.
Also, in the regions, 15 projects on construction and reconstruction of group conduits will be implemented in the amount of KZT15.2 billion.
As a result of the planned works, access to centralized water supply and sanitation in cities will be 93%, and in rural areas - 58% and 12%, respectively.
In order to create conditions for the sustainable development of the regions, based on the effective use of the social and economic potential of each region, proposals will be developed for the development of the Forecast Scheme of the Territorial Development of the Country until 2030.
Changes will also be made to the Program for the Development of the Regions until 2020, including the allocation of at least KZT 100 billion from all sources to rural water supply.
6) International cooperation
On a systematic basis, Kazakhstan's economic interests will be protected at the WTO site.
To expand trade and economic cooperation within the framework of the EAEC, free trade agreements will be concluded with Israel, Egypt, India, Singapore and Serbia.
The work will continue to digitize the economies of the EAEC, eliminate exemptions and restrictions on the market of the Union, as well as improve the contractual framework in the areas of customs, technical, transport regulation, public procurement and competition.
Within the framework of the OECD country program for 2018, work will continue to join the 12 remaining legal instruments, implement 17 new Surveys, and improve the status of Kazakhstan in the 8 OECD committees.
In order to further develop trade, the "Roadmap for the development of electronic commerce" and e-commerce activities of the "Digital Kazakhstan" Program will be implemented, and the Law "On the Regulation of Trading Activities" will be amended.
Dear participants of the meeting!
The Ministry will make every effort to implement the tasks set by the Head of State and take comprehensive measures to ensure macroeconomic stability and economic growth in the country.