Kazakhstan Chamber of Commerce in the USA


Kazakhstan presents a new package of incentives for foreign investors 0

Posted on July 14, 2014 by KazCham
Colibri Law Firm
Minister of Economics and Budget Planning of the Republic of Kazakhstan Mr. Erbolat Dosaev presented a new package of incentives for foreign investors at the International Investment Conference in Astana on 2 May 2014. The set of the following amendments to the respective laws and regulations of the Republic of Kazakhstan will be introduced to the Parliament in June-July 2014.
– Visa facilitation; unilateral visa-free travel for the citizens of certain developed countries with the period of stay up to 90 days; as well as issuance of investors visas to the management of local subsidiaries of the foreign companies.
We note, that beginning 15 February 2004, certain types of business, tourist and private visas are issued to the citizens of 45 developed countries without official invitation.– Investors will have an opportunity to employ foreign stuff for the period of the investment project and one year after its completion outside the quota and without work permit.
We note, that currently foreign employees are required to obtain a work permit, except for the secondees who are entitled to a 120 days stay under a regular business visa within one calendar year.– Legislative 10 years stabilization clause, freezing the forecasted and regulated tariffs and prices in tax, migration and ecologic spheres.– Implementation of the OECD recommendations re international commercial arbitration. 

– Additional incentives for the investment projects of TNCs: investment subsidies of the State compensating up to 30 per cent of capital expenditure upon putting the facility into service; exemption from corporate income tax for 10 years; long-term secured order of goods and services from national companies and state authorities. 

– One-window procedure for all licenses and permits as well as queries of the investors will be carried out by the Committee for Investments of the Ministry of Industry and New Technologies. 

We note, that in accordance with the existing Kazakhstan law, foreign investors refer for licenses, permits and queries to respective Ministries and other state authorities. – State subsidies covering utilities and transportation costs, increase of lease period of agricultural land.

Кazakhstan – U.S. Investment Forum 2010 0

Posted on July 27, 2010 by Sergey Sek

The Embassy of Kazakhstan will be hosting the third annual Kazakhstan – U.S. Investment Forum 2010
on November 8-9 in New York.
The forum, an official Government of the Republic of Kazakhstan event in partnership with Newsdesk Media Inc, is entitled: ‘Program of Accelerated Industrial-Innovative Development of Kazakhstan’.
This year’s event will highlight the Government of the Republic of Kazakhstan’s initiatives to increase the productivity
and competitiveness of the economy in order to provide sustainable and balanced development. Following a teleconference address by H.E. Karim Massimov, the Prime Minister of Kazakhstan, the forum’s agenda will provide in-depth analysis across the designated sectors of Agriculture, Construction and Metallurgy, Oil & Gas and Petrochemicals, Machinery, Transport and Telecommunications, Energy, and the Chemical and Pharmaceutical Industry.
A high-level delegation from Kazakhstan led by H.E. Asset Issekeshev, Deputy Prime Minister and Minister of Industry and New Technologies, will participate along with H. E. Richard Hoagland, United States Ambassador to the Republic of Kazakhstan. The forum will also host the formal launch of the Republic of Kazakhstan’s Chamber of Industry and Commerce representative office in the United States.
For further information, please visit: www.kazakhinvest.com

World Bank to lend $1 billion to Kazakhstan 1

Posted on June 02, 2010 by KazCham

(SRI) – The World Bank said last Tuesday it had approved a $1-billion loan to Kazakhstan to provide budget support for the government’s economic program.

The loan will help support the government’s economic program by focusing on fiscal policy, management of the budget and banking regulation, the World Bank said in a statement.

“Kazakhstan is borrowing $1 billion from the World Bank to finance the 2010 republican budget deficit, support growth, and maintain higher social commitments stipulated in the budget,” Bolat Zhamishev, Kazakhstan’s Minister of Finance, was quoted in the statement.

According to Motoo Konishi, World Bank regional director for Central Asia, the approval of the loan reflects confidence by the bank in the “direction of economic policies and reforms of the [Kazakh] government.”

The loan has an interest rate equal to 6-month LIBOR plus variable spread, and a maturity of 25 years, including a three year-grace period.

SOURCE: http://silkroadintelligencer.com/2010/05/30/world-bank-to-lend-1-billion-to-kazakhstan/

Foreign direct investment reaches $108 billion in 2002-2009 0

Posted on May 20, 2010 by KazCham

(SRI) – Foreign direct investment (FDI) in Kazakhstan amounted to $108 billion in 2002-2009, Minister of Economic Development and Trade Zhanar Aitzhanova said.

Among the biggest investors were the Netherlands, the United States, the United Kingdom, France, Italy, Russia, China and South Korea.

According to Aitzhanova, the commodity sectors have absorbed the bulk of foreign direct investment. In 2009, only about ten percent were invested in the services sector from a total FDI inflow of $18.4 billion.

Aitzhanova noted that Kazakhstan has reduced its corporate income tax from 30 to 20 percent as of 2009 in an effort to increase the attractiveness of the country to investors. Kazakhstan plans to further reduce the tax to 15 percent in 2011.

SOURCE: http://silkroadintelligencer.com/2010/05/20/foreign-direct-investment-reaches-108-billion-in-2002-2009-minister/

Infrastructure Investment Kazakhstan Summit 2

Posted on May 19, 2010 by Sergey Sek

This high-level strategic summit is where the government, the private sector, investors and financiers will gather to discuss strategies and opportunities in Kazakhstan, establish partnerships, network, and meet key industry leaders who are driving infrastructure development and sustainable economic growth in Kazakhstan.

Experts agree – the investment climate in Kazakhstan is more attractive than ever.

  • The government is committed to long-lasting partnerships with foreign investors, which is crucial to the development of infrastructure in Kazakhstan;
  • Opportunities abound for both new and existing investors in the President’s Strategy 2020;
  • Kazakhstan’s successful anti-crisis programme has initiated vital steps toward economic stability;
  • Key fiscal regulatory and supervisory changes have paved the way to a ?? plan for post-crisis management to the banking and financial sectors;
  • Economic diversification is at the top of the government’s agenda – numerous investment opportunities in both the oil and non-oil sectors have been identified;
  • The unique Foreign Investors’ Council has led the way to crucial legal and taxation reforms through dialogue between the private sector and the government – a sign of a maturing market that acts on the needs of its foreign partners.

Astana Invest 2010 1

Posted on May 19, 2010 by Sergey Sek

We invite you to participate in the First International Investment Forum “Astana Invest 2010”, which will be held on June 7, 2010 in Astana.


Astana Invest 2010 Forum is organised by Akimat of Astana city and with the active support and direct participation of the Government of the Republic of Kazakhstan.

The Astana Invest 2010 Forum is aimed at improving the investment climate and further stimulates the flow of domestic and foreign investment in the city’s economy, the formation and promotion of Brand Astana to the world markets in the strategy of joining the Republic of Kazakhstan in the top 50 most competitive countries in the world.

For participation at the Astana Invest 2010 Forum we invited to attend representatives of central and local executive bodies, national companies, development institutions, foreign companies, financial institutions, large and medium business capital.

Potential investors will be offered a unique opportunity to discuss specific investment projects and to obtain the latest information on investment projects in the Astana city.

There will also be presentations of projects using public-private partnerships, various projects for industrial, construction and infrastructure areas of the Astana.

I look forward to seeing you at the Astana Invest 2010 Forum – the event of the year for networking, in-depth analysis and up-to-the-minute information.



Imangali Tasmagambetov
Mayor of Astana City

III Astana Economic Forum 0

Posted on April 28, 2010 by Sergey Sek

The III Astana Economic Forum will be held in July 1-2,  2010 in Astana city and dedicated to the issues of ensuring sustainable economic growth in the post-crisis period.

The third economic forum will bring together over 2000 representatives from political and business area from more than 50 countries of the world this year, and also the leading scientists, representatives of the public and mass media to discuss the key subjects of the global economy development.

The two-day event program is dedicated to the issues of innovation, business, industry, international trade, export and import, customs union, energy, ecology, international financial and currency systems, Islamic financing and youth development. Within the frames of the Forum the exhibition of scientific works and innovative projects, competitions for the best research works and two events with the participation of the international organizations concerning the issues of the role of information and communication technologies and development of “green” economy will take place.

Contact information: 
Tel.: + 7 7172 70 18 32 
Fax: +7 7172 70 18 35 
E-mail: forum@aef.kz 
Skype ID: aef2010

It’s time to change the oil-Borate image of Kazakhstan in America 2

Posted on April 26, 2010 by KazCham

United States has been successful trade and economic partner for the countries of Central Asia for many years. However, this partnership was limited mostly to work of U.S. energy companies upon requests of Washington to hand in the operations of coalition forces in Afghanistan. From the other side, it’s extremely difficult to enter the US market for the Central Asian States due to many obstacles.

It’s symbolic that the first country of Central Asia, which opened a representative office of its Chamber of Commerce in the United States (New York City), was Kazakhstan. The head of the representation, Yuliya Daurova, is going to tell about main activities of the chamber and how it is going to revive the Kazakh-American business cooperation.

According to Yuliya Daurova, ROI in Kazakhstan reaches 150%.

– Promotion of the political interests of Kazakhstan has been doing actively for a long time. It includes the current chairmanship of the OSCE and the Organization of Islamic States the next year  – as vivid examples. What about intentions of foreign countries to develop the business and economic cooperation with Kazakhstan? And how can Kazakhstan Chamber of Commerce promote that?

– During the crisis, the interest of American companies to developing promising markets increased. It includes Kazakhstan. The introduction of industrial-innovative strategy by the Government of Kazakhstan has intensified the interest of investment companies and banks in the United States to the country. Thus, major part of requests in our representative office comes from them.

For example, one of the largest U.S. private equity companies believes that its best investment over the past 10 years was a project in Kazakhstan, where the internal rate of return of these investments amounted to 150%, which is a high rate. However, many U.S. companies just want to know more about the economic situation in our country, since they are still afraid of the political and financial risks. Yes, U.S. companies now show interest in Kazakhstan, for example in the agricultural sector and the chemical production, but in my opinion, they are still very cautious.

Thus, we plan to hold regular seminars and conferences which are tailored to target audiences in individual sectors on issues of doing business in Kazakhstan. Seminars are supported by Grata Law Firm (New York), auditing company PricewaterhouseCoopers Kazakhstan, Broad Street Capital Group and, of course, the Embassy and the Consulate of Kazakhstan in the United States.

We have already launched social networks marketing and plan to hold a series of activities to promote the business image of our country in America, because we are often told that  it is very difficult to learn about Kazakhstan. So, we’ll try to change this attitude.

I want to stress once again that there is the interest – both by U.S. companies and by Kazakhstan firms – to conduct joint business. Basically, it’s about joint ventures and export-import operations. But it’s very difficult to contact the right people in Kazakhstan for American companies. They do not know how to do this and fall into an information vacuum.

Our embassy in Washington has been working on this problem over years, but it is over workloaded. So, we hope to become the “business bridge” between our two countries and to provide operational information about projects, legislation and investment climate in Kazakhstan.

– United States companies have been actively working in the republic in the energy industry since Kazakhstan proclamation of independence. What do they do now in this area? And what is the approximate ratio of involvement of U.S. businesses in other areas to oil production involvement in Kazakhstan?

– The United States have invested in Kazakhstan’s economy 14.3 billion (from 1993), mostly in oil and gas industry and commensurate services. Now, U.S. exports to Kazakhstan has fallen to 2005 levels and totaled $ 600 million in 2009, although there was a time when it reached a billion. It includes 40% for equipment for the oil industry, 25% for transportation equipment, and the rest for computers, telecommunications, electronics and chemical industries.

Despite the fact that today some American agriculture, medical equipment, and educational firms are very interested in Kazakhstan market, it seems to me that the current ratio of investment into O&G complex comparing to other areas will not change. Probably, it’ll be the same 65% of U.S. investments on oil, gas and associated transport lines development.

– Do you think that the image of “business background” of Kazakhstan in America has been changed compared to the times when the cooperation just began? Do not you think that Americans, despite their nearly twenty-year presence in the country, are still very poorly informed about Kazakhstan and its real business potential?

– Kazakhstan, oil , Borat – that’s the image of Kazakhstan for the majority of Americans, still. Many U.S. investors react vigorously with the word “oil” in relation to Kazakhstan, but they are still completely unaware of the fact that Kazakhstan is, for example, one of the world’s largest exporter of copper, uranium and grain.

When you tell them that, it is a real discovery. Therefore, the change of country’s image will take a lot of work. I need result as follows: the word “copper” should be associated with the company “Kazakhmys”, aluminum with ENRC and so on.

So far, the general business relations between the United States and Kazakhstan has not been changed. Oil is still in the first place. The Kazakh exports to the U.S. for the crisis year declined only  by $ 65 million and amounted to 1,545 billion dollars. Of course, that was mostly oil. Everything else is mainly ores and metals.

– Energy and its development is the priority area for the United States regarding the cooperation with Kazakhstan. But today Kazakhstan needs money for the development of agriculture, small business and transport industries from U. S. What has been done to bring U.S. companies of non-energy sector to Kazakhstan over the years?

– You know, this is a difficult question. Judging by the fact that most American companies which come to us are investment companies, they are, in principle, interested in launching projects in Kazakhstan. However, the U.S. firms are interested in public-private partnership or joint ventures with local partners. U.S. investors need sound guarantees to work in Kazakhstan.

As I see, American companies usually submit projects to Kazakhstan ministries, and then hope to get any response over the years. I think that if U.S. investors were more knowledgeable about our country, they would contact partner companies directly, and it would certainly accelerate the process. But today American companies get into the information vacuum.

– What are the interests of Kazakhstani business in America? And how representation of your Chamber of Commerce can help Kazakh businessmen to work in the U.S. market?

– Officially our Kazakhstani business in the United States represented by only one company – Wimpex (vodka). However, our oil companies have strong business ties with our American partners, they have their kind of rep. offices, plus Astana airlines reside in New Jersey.

I have met several private investors from Kazakhstan in America. For example, a Kazakh young man opened a glass factory and resold it then. There is a company owned by one beautiful Kazakh lady, which deals with the import of caviar from Kazakhstan to the United States. Our young guys here opened an advertising agency, created a design studio and a model agency.

If we talk about the prospects of Kazakhstan’s business in the United States, there are great opportunities to work with mining companies and grain producers. In America, there are potential buyers of Kazakh uranium, gold and grain. I mean there is a potential for mutual cooperation.

And I think that it exists for small businesses from Kazakhstan too. For example, in such a huge city like New York, there is no a Kazakh restaurant while there are about 10 thousand Kazakhs living here plus two million Russian-speakers. Add here a very active go-out population of other nations, it’ll be approximately 10 million of inhabitants. Here you have an opportunity for our Alasha or Tubeteika.

With specific regard to our work, we are ready to help in finding partners, customers, and co-financing in the United States. Also, we help with registration, immigration and other issues.  So, if you have a good business proposal and a partial funding, it is possible to organize the Kazakhstani business here in the United States.

– What, in your opinion, are the main problems which have prevented the Kazakhstan and American entrepreneurs to interact so far? Is there only problem of the lack of adequate information about each other, or it is more mentality, lifestyle, cultural differences?

– In general, people face several problems: the absence of proper information, the different languages, and the distances between the countries. On the other hand, Chinese and Russian companies work successfully in the United States regardless these problems. Some of them even do not speak English at all and work here for years.

I agree that it happens partly due to the differences in mentality. In my opinion, there are purely social and cultural aspects in the relations between the two countries. For example, the Kazakhs live patriarchal structure, derived from the ancient times, and it is much harder for them to adapt to specific American culture. Americans are, by nature, more open and assertive in their behavior, and it is easier to do business for them. The same dress code, for example, is pretty simple, but something may be unacceptable in the same clothing for Kazakhs. But since we talk about business and not well-established family relations which have thousands years of tradition, so, perhaps, there should be more flexible and less formal relations. Still the main constraint in enhancing the bilateral relations is the lack of timely and reliable information about each other.

– Given the fact that a centralized bureaucracy in the U.S. is extremely strong and it does not solve problems of small business operationally, isn’t it more profitable for you to contact senators of individual states in the country directly, since they are much more flexible in making decisions and will be more interested in helping US companies with investments and projects in Kazakhstan.

– Unfortunately, the bureaucracy stifles business development not only in the United States, but in Kazakhstan as well. Definitely the situation has improved with the arrival of young and dynamic vice-ministers in the Kazakh government, who are easier to reach. They are more open to contact and react more quickly to certain requests.

Yet, the situations with the bureaucratic obstacles remain severe. For example, government people there sent me approved scanned, signed and stamped answers on official forms to my email requests. Businessmen barely do that. They will email me back within 48 hours as usual.

There is also a significant difference in the affairs of government agencies of both countries. For example, in the United States a businessman will receive an answer for an request, sooner or later. It usually takes a couple of weeks, sometimes, two months. Still, the answer will there. Moreover, the higher the rank, to whom you are applying, the more assurance that you’ll get a prompt response in U.S. In Kazakhstan a businessman finds himself in the Bermuda Triangle.

As for senators of states and their interest in cooperation with Kazakhstan, you are absolutely right. We have already established connections with the state of Louisiana in the south of the USA; Nebraska – an agricultural state; Washington on the Pacific coast. We are now working to expand our business ties in California, and also plan to enter into agreements with local business associations in New York.

We are open and glad to various forms of bilateral cooperation, we actively try to help companies to enter and work in both markets and look forward to successful implementation of our plans to strengthen trade relations between the U.S. and Kazakhstan.

SOURCE: Delovaya nedelya Kazakhstana. Yuriy Sigov. 2 April 2010.

The Caspian corridor 0

Posted on April 25, 2010 by KazCham

AFTER SO MANY years of dependence on foreign  ! goodwill for the export of its oil, gas and mineral: the Kazakh government is insisting on a control stake in the new Kazakhstan Caspian Transport System (KCTS). This is designed to carry export pipelines south to a new port at Kuryk, south of Aktau, entirely through Kazakh territory.

New high-capacity pipelines within this corridq will run south for hundreds of kilometres from tilt giant, city-sized processing plant for Kashagan oil gas at Eskene, 30km north of the oil capital Atyrau, to a new port at Kuryk. From there oil and gas will be transported across the Caspian Sea to Baku. The new trunk pipelines running down the corridor will also be linked up to the many smaller fields being  developed either side of the route.

The oil companies, which are expected to foot  most of the bill for this multi-billion dollar project,  however, are still smarting from their loss of control  over the CPC pipeline through Russia, which they also financed and initially operated. As the main financiers and big future users of the KCTS, the international oil companies want to ensure that they retain as much  influence as possible over future managements.

A conclusion to months of hard bargaining between -government and the oil companies had not been  reached at time of writing, but a compromise deal is  expected shortly.

The main purpose of the KCTS is to ensure that  western Kazakhstan has the export capacity to cope  with the expected doubling of oil and gas production  when the Kashagan field comes on stream in four  years’ time. It will ensure that rising oil and gas  production from the country’s three biggest fields  – Kashagan, Karachaganak and Tengiz – as well as  dozens of smaller fields in western Kazakhstan will  flow down pipes, ports and railways under Kazakh  jurisdiction and not require transit payments to  foreign governments.

The KCTS will constitute a major strategic  resource for Kazakhstan, which used to be totally  dependent on transit through Russia to reach export  markets but is now rapidly developing into a major  transit country in its own right, with high-capacity  pipelines running 3,000km east to China and hopes  of developing further routes south through Iran –  international politics permitting.

The new corridor will not only carry Kazakh oil  and gas to Kuryk. It is also expected to accommodate  up to 30 billion cubic metres a year of gas flowing  north from Turkmenistan to Russia. But building  this northbound pipeline is conditional on  implementation of an agreement signed in 2007  between Russia, Kazakhstan and Turkmenistan.  This was to enable Russia to raise gas imports from  Central Asia. But Moscow seems to be reviewing this  agreement in the light of a sharp decline in demand  for gas from Gazprom’s recession-hit domestic and  European consumers.

On past performance, the end result of current  negotiations between the Kazakh government and  oil companies over how the KCTS corridor is to be  managed is likely to be a compromise that leaves both sides reasonably satisfied. The expected benefits from  the new corridor are, after all, huge for all concerned.

From the Eskene processing plant, equivalent  in size to the city of Amsterdam, the corridor will  terminate at Kuryk, a sheltered, relatively deep-water  site chosen for the large new oil and gas export  facility. From there a fleet of oil tankers will ferry oil  some 700km across the Caspian Sea to new importing h facilities south of Baku, the capital of Azerbaijans

At some point in the future, gas may also be  transported under the Caspian in pipelines and  President Nazarbayev has also expressed his interest  in a possible liquefied natural gas (LNG) facility to  freeze natural gas and transport it in special LNG  ships across the Caspian to a de-freezing plant on the  Azeri shores.

Eskene, which is some 35km north of Atyrau,  will process oil from the offshore Kashagan field,  and three other smaller fields in the concession are  currently being developed by Exxon-Mobil.

The complex will start operating when the first  oil comes from Kashagan around the fourth quarter  of 2012. Production will then build up rapidly as  Kashagan alone is expected to produce some  1.5 million barrels a day before the end of the next  decade. The hot, corrosive oil which forces its way  to the surface from the Skm-deep deposits needs to  be stripped of deadly hydrogen sulphide and other  poisonous gases as well as foul-smelling mercaptans  and other pollutantss

These involuntary by-products of making the oil  and gas safe for transport will be used as feedstock for a proposed $6.5 billion petrochemical plant, which  the government is discussing with deep-pocketed  investors from the Gulf States.

Invest in Kazakhstan An official publication of the Government of the Republic of Kazakhstan, 2009. Pages: 52-53.

Kazakhstan Mining Report Q2 2010 0

Posted on April 15, 2010 by KazCham

Kazakhstan’s robust mining industry has weathered the global economic storm and should demonstrate strong growth within the next few years. Rising commodity prices helped pull the country out of the recession in 2009.
Rallying copper prices were particularly influential in this achievement, as Kazakhstan is currently the world’s 10th largest producer of copper.

The recovery of prices has been a chief factor in attracting FDI and the government is keen to capitalise on interest in the mining industry. In January 2010, it was reported that the government wanted to offer tax incentives for foreign investors looking to exploit the country’s rich mineral resources.

Businesses willing to produce materials within the country could enjoy concessional financing of projects, required infrastructure funding, and tax incentive measures in addition to exemption from land tax, corporate income tax, value added tax on import of goods and property tax.

As well as attractive tax incentives, Kazakhstan is also taking steps to improve its current legislation. The country recently received EUR500,000 from the European Bank of Reconstruction and Development (ERBD) to analyse the current legislation governing the country’s mining sector.

The CEO of the ERBD stated that the international expertise available would be invaluable to improve the country’s current regulations.
Gold naturally continues to attract investors on the back of positive developments regarding exploration and drilling in Kazakhstan.

In November 2009, Central Asia Resources upgraded its drilling program at the Atlyntas project after more than 500,000 ounces (oz) of near surface gold were discovered in a section covering only around 10% of the entire prospect area. The project will now receive a further US$1.6mn investment to enable additional drill programs in 2010.

Kazakhstan continues to establish itself as a key figure in the uranium mining sector. It finally fulfilled its ambition of overtaking Canada and Australia to become the world’s leading supplier of the material in 2009. Last year, Kazakhstan produced 13,900 tons, a 63% increase in output.

This accounted for 30% of global production. Kazakhstan is now confident it can increase production a further 29% in 2010 to reach 18,000 tons. There was also speculation in December 2009 that Kazakhstan and Iran were in the midst of talks which would see Kazakhstan supplying the country with 1,350 tons of uranium in a US $450 million deal. Both countries’ governments have denied the rumors.

Strong growth is anticipated for Kazakhstan’s mining industry. The country is well positioned to take advantage of expanding demand from nearby China and India for metals and energy resources. Growing interest in cleaner burning fuels like uranium also means that Kazakhstan is going to be a key figure within this sector.
As metal prices continue to improve, more investment into the sector is anticipated, bringing with it new expertise and technology to accelerate growth within the industry, according to OfficialWire.

SOURCE: Kazakhstan Newsline #1005 – April 15, 2010

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