KazCham

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The Kazakh National Holding KazAgro plans to attract $2 billion in funds from the World Bank for 35 years for lending to the agro-industrial complex, according to the Chairman of the National Holding Nurlybek Malelov.

According to the chairman, the loan will provide a twofold increase in lending to the agricultural sector, without attracting funds from the budget.

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Central Asia’s largest transport and logistics centre has been launched in Astana, Kazakhstan.

The country’s railway operator, Kazakhstan Railways, has said that the centre will provide integrated storage services with a full cycle of multi-modal logistics.

Transport and logistics centres will also be built in other major cities in Kazakhstan, such as Aktobe, Pavlodar, Almaty, Uralsk, Atyrau, Kostanai and Semey as part of a programme to create external and internal terminal networks.

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In a major legislative development, Kazakhstan is implementing a new law on public-private partnerships. As such, our team has prepared an extended overview of the major aspects of this new law, which is due to enter into force next week on 23 November 2015.

Kazakhstan’s President Nazarbayev has signed the Law “On Public-Private Partnership” (the “Law”) which provides for the conditions of cooperation between the state and private businesses in Kazakhstan. The law is aimed at ensuring the country’s sustainable social and economic development and will enter into force on 23 November 2015.

The Law regulates the main approaches and phases for the implementation of public-private partnership (PPP) projects, and outlines the challenges, principles and defining characteristics of PPPs. It also provides guarantees for the rights and interests of the participants of PPPs, the forms of their participation in projects and the means of state support.

The participants of PPPs include: (i) the state (ii) entrepreneurs and (iii) financial organisations that provide project financing. The Law stipulates the conditions for sources of financing for PPP projects, the reimbursement of expenses to subjects and income generation.

The Law also stipulates that a private partner may be selected on the basis of (i)a tender or (ii) direct discussions. It also defines the qualification requirements that a potential private partner must satisfy in order to participate in a tender process, the conditions for a tender process and the procedure for the conclusion of PPP agreements.

Specifically, the new definitions include the following:

• “Private partner” – a sole entrepreneur, partnership, consortium or legal entity, except for persons acting as public partners in accordance with the Law, entered into a public-private partnership agreement;
• “Public partner” – the Republic of Kazakhstan, on behalf of which the Government of the Republic of Kazakhstan or local executive body of the region, city of republican status and the capital, as well as their other authorised state authorities and subjects of quasi-public sector, 50% and more of voting shares (interests in the charter capital) of which are directly or indirectly owned by the state, concluded a public-private partnership agreement;
• “Public-private partnerships” – a form of cooperation between the public and private partners corresponding to the characteristics defined in the Law;
• “Direct agreement” – a written agreement between the public partner, private partner and creditor of a private partner for the implementation of a public-private partnership project of special importance.

In addition, President Nazarbayev has signed the Law “On amendments and additions to some legislative acts of the Republic of Kazakhstan as to the public-private partnership”. The purpose of this legislative act is to bring current Kazakh legislation into compliance with the new Law.

This Law is also aimed at implementing some of the “100 Concrete Steps” and regulates the issues involved in attracting investment for the construction of infrastructure for the Kazakh population.

AramcoWorld

In October 2014, the us National Aeronautic and Space Administration (nasa) released images of the Aral Sea taken by its Terra satellite. These were among the first to show the South Aral Sea’s entire eastern basin as bone-dry—a dramatic difference from a similar image taken in August 2000. “This is the first time the eastern basin has completely dried in modern times,” said geographer and Aral Sea expert Philip Micklin of Western Michigan University. “And it is likely the first time it has completely dried in 600 years, since the medieval desiccation associated with diversion of Amu Darya to the Caspian Sea.”

Aral, population just above 30,000, is the largest town on the northeast shore of the North Aral Sea, and some 73,000 people remain living in the surrounding region. Here, explained Darmenov, the Kazakh government and World Bank must work together with the Syr Darya river to save the sea. The river is the sea’s sole source of replenishment, and its fate is still largely determined by cyclical rainfall patterns, as well as snowmelt from the distant Tien Shan Mountains.

In 1976, according to a historical marker at the once-thriving port, Aral shipped 5,000 metric tons of wool, 340 furs, 3,000 sheepskins, 1,500 pairs of woolen gloves and 1,200 pairs of woolen trousers. Now, the tourists who stop by here can climb aboard the Lev Berg, a fishing boat painted bright blue, and look out over the desertified lakebed. Two rusting cranes that have not been used since the early 1980s hulk above the otherwise flat horizon.

But the waters that by the early 2000s had retreated 100 kilometers from Aral are now only 20 kilometers away, and they are coming closer.

“We inherited the problem of the Aral Sea from the Soviet Union, but as soon as we became independent, we adopted special programs,” said Zhanbolat Ussenov, director of the Eurasian Council on Foreign Affairs and former spokesman at Kazakhstan’s Foreign Ministry.

“We of course understood that we wouldn’t be able to save the sea on our own— from neither a financial nor an expertise point of view—so we created an International Save the Aral fund,” Ussenov explained. “We invited the World Bank and individual countries to help us with this environmental catastrophe. And I’m happy to say that today the Aral Sea is slowly returning to its original boundaries.”

The dream of saving the entire Aral Sea – both North and South – is unrealistic, said experts who know the region. But everyone seemed to agree that the first phase of the project Ussenov alluded to – officially known as the Syr Darya Control and Northern Aral Sea Project, or synas-1 – has been a success so far.

Ahmed Shawky M. Abdel-Ghany, a senior water-resources specialist with the European and Central Asian region of the World Bank’s Water Global Practice, has managed the project from his Washington office since late 2010. He said synas-1 cost $83 million, and it included a subproject for restoration of the North Aral Sea.

“We’re not talking about the whole Aral Sea, just the northern part that fully lies in Kazakhstan,” said the Egyptian civil engineer, who’s worked in 20 countries during his 12-year career with the World Bank.

He said that one crucial element of synas-1, construction in 2005 of the 13-kilometer-long Kok-Aral Dam, increased the volume of water in the North Aral Sea by around 50 percent in three years.

“The northern Aral Sea was initially [in 2005] 38 meters above sea level. Now it could reach around 42 meters,” said the engineer. “As a consequence, salinity in the NAS has been reduced by around half, but all these numbers are subject to the hydrological variables that change every year.”

EdgeKz

The world today presents a wide range of music genres for people of all tastes. Whether electronic or heavy metal, sounds of any kind are available for everyone. Some of Kazakhstan’s outstanding musicians try to preserve traditional sounds and give them a modern twist.

This year, Almaty hosted The Spirit of Tengri festival for the third time. The event attracted ethno musicians from Kazakhstan, China, Estonia, Georgia, Hungary, Norway, Russia and Turkey.

The Spirit of Tengri is organized to unite the efforts of the current generation to preserve the spiritual riches of its ancestors, according to the festival’s website. Participants are successors of the traditions rooted deeply in the history of thousands of years of the Great Steppe.

Three groups, Tigrahaud, Arkaiym and Aldaspan, shared their stories and their experience at the festival with “EdgeKz.”

Tigrahaud, created two years ago, was the brainchild of Daniyar Zhakiyanov, who is also its manager.

“I have been dreaming about such a project for a long time and later when I was forming a group there were very tough requirements for the musicians. First, the professional level had to be high, as well as the performing skills, and the key point for me was the versatility, meaning that in addition to the main instrument, the musician had to play another folk instrument,” he said.

Zhakiyanov’s idea was to show audiences as many folk instruments as possible with a small band. From the beginning, Tigrahaud has aimed at drawing Kazakh and international audiences and promoting national folk music to the world.

The group is named for one of the Saka tribes that lived in the area of the modern Almaty region and the tribe that created the famous Golden Man unearthed from the Issyk burial mound. The moniker fits, as the group lives in Taldykorgan, where Tigrahaud formerly resided.

This year the band participated in the Spirit of Tengri for the first time. The group has grand plans. It wants to show the world who the Kazakhs are, their extraordinarily-beautiful, sometimes cruel history and how a small nation had to defend the land from barbarians – all through its music.

Watch the Music video

Find more compositions here

Arkaiym, a duo created in April 2014, is another bright representative of Kazakh ethno-folk music. Members Abzal Arykbayev and Anara Kassymova, who also perform with the famous ethno-folk groups Turan and Art-Dala, developed a new direction which they call neo-ethno-folk. The genre is a completely different direction in music, embodying the synthesis of diverse musical styles. The basic idea behind the duo’s creation was the desire to recreate the sound of old, archaic instruments in an entirely new interpretation.

The artists play more than 30 types of folk musical instruments, both Kazakh and world types, including winds of Native North Americans, didgeridoo (shamanic musical instrument of the Australian Aborigines), darbuka (Turkish national musical instrument) and Kyrgyz instruments.

As any musician or band, Arkaiym wants world fame – not their own fame, but fame and recognition of Kazakh folk instruments.

“Because we have a priceless treasure, which unfortunately is sometimes unnoticed by us,” the duo explained.

Working at the Museum of Musical Instruments, the performers have a chance to draw visitors closer to the country’s musical heritage through training, workshops and exhibitions. They released their first album, “Arkaiym,” with the help of The Foundation of the First President of Kazakhstan through which they won a grant for creative development, and are looking forward to the release of their first video.

Watch the Music video

Aldaspan, created by Nurzhan Toishy, is famous among ethno music lovers for its electric dombra sound. Toishy fell in love with heavy metal as a kid. Listening to riffs by James Hetfield, Kerry King, Max Cavalera and others, he realised their emotional sound was very similar to the riffs and chords used in Kazakh kuis. Toishy played the dombra in high school; after graduation, he and Murat Kubekov, a piano-tuner and dombra maker for the Kazakh State Conservatory, created three experimental electro dombras. He continued to tinker with the design, wanting to show to the world the possibilities of the instrument, and chose heavy metal as his style, opting to leave dombra playing to others and becoming a drummer, soloist and front man.

Aldaspan is a heavy kind of sabre used against armored soldiers and cavalry. The group identifies with war, courage, bravery and fighting; real men’s stuff, the backbone of Turkic folk songs. Kazakh people formed the basis of Genghis Khan’s army and for them, war was their main profession after farming.

Combining heavy metal with Kazakh national instruments makes the sound fresh and unusual.

Watch the Music video

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The Samruk Kazyna, Baiterek and KazAgro national holdings will be featured in the new privatisation programme, after which they will either be transformed into lean organisations or liquidated, according to the Kazakh President Nursultan Nazarbayev.

The assets of the Samruk-Kazyna national welfare fund include: the KazMunaiGas national oil and gas company, the Kazakhstan Temir Zholy railway operator, Kazakhstan Electricity Grid Operating Company (KEGOC), Kazakhtelecom telecommunications operator, and the Kazatomprom national nuclear company.

The Baiterek national management holding includes: JSC Development Bank of Kazakhstan, JSC Investment Fund of Kazakhstan, JSC Housing Construction and Savings Bank, JSC Kazakhstan Mortgage Company, JSC KazExportGarant, JSC Entrepreneurship Development Fund Damu, JSC National Agency for Technological Development, JSC Kazakh Fund of Mortgage Guarantees, JSC Kazyna Capital Management, JSC Baiterek Development, and JSC Public Private Partnership Advisory Center.

The KazAgro National management holding includes: the National company Food Contract Corporation JSC, KazAgroProduct JSC, KazAgroFinance JSC, Agrarian credit corporation JSC, Fund for Financial Support of Agriculture JSC, KazAgroGarant JSC and Kazagromarketing JSC.

 

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Kazakhstan’s Ministry of Energy expects that the investment decision on the expansion project of the Karachaganak oil and gas field will be made by 2018, said the Deputy Energy Minister Magzum Mirzagaliev. It is also expected that the design of the Karachaganak field will be completed by the same year.

Discovered in 1979, the Karachaganak field is one of the largest gas condensate fields in the world, and accounts for around 49% of Kazakhstan’s gas production and 18% of the country’s oil production.

Reuters

Nov 18 Kazakhstan plans to sell stakes of at least 25 percent in 43 large state-owned companies via initial public offerings (IPOs) in 2016-17, the Samruk-Kazyna sovereign wealth fund said on Wednesday.

The government faces a plunge in revenues from oil, Kazakhstan’s main export. President Nursultan Nazarbayev told a government meeting on Wednesday he wanted Kazakh businessmen and companies to take part in the privatisations.

The stakes will be sold on the floor of the oil-rich nation’s financial centre being built in the capital Astana, the fund said.

The businesses to go public include oil and gas company KazMunaiGas, uranium company Kazatomprom, railway company Kazakhstan Temir Zholy and mining firm Tau-ken Samruk, it said.

Tau-ken Samruk has a 30 percent stake in Glencore-controlled zinc producer Kazzinc.

Offered for sale will also be stakes in electricity firms united in the fund’s division Samruk-Energo.

Samruk-Kazyna manages state-owned stakes in companies representing all major branches of Central Asia’s largest economy.

Two sources close to the government told Reuters this month the companies in which the state would sell stakes included miner Eurasian Resources Group (ERG), flagship carrier Air Astana and Kazakhtelecom.

The fund said that besides holding IPOs in the 43 large companies, it would privatise 182 “non-core assets” through auctions in the same period.

The total value of the capital of all the companies slated for sell-off is around 2.5 trillion tenge ($8.1 billion), the fund said.

EBRD

EBRD loan and grants from central and local governments will help improve drinking water, cut waste.

The EBRD and the government of Kazakhstan are continuing to support water and wastewater modernization in the country with a financing package to upgrade the water supply in Taraz, a city of over 300,000 people and a provincial capital of the Jambyl region in the south of Kazakhstan. The project will also be supported by the city.

The EBRD will lend 1.05 billion tenge (€3.2 million equivalent) which will enable the municipal water and wastewater company SCE Taraz Su to modernize the water systems in the city to make them more energy efficient and reduce water losses.

The government of Kazakhstan is providing an investment grant of up to 945 million tenge (€2.9 million equivalent) and the local government – the city of Taraz – is extending a grant of up to 105 million tenge (up to €320,000 equivalent).

The project will be carried out under the umbrella of the Enhanced Partnership Arrangement between the EBRD and the government of Kazakhstan. Under that agreement, the government and the Bank are joining forces to modernize municipal and environmental infrastructure across the country.

The regional authorities – the oblast and city akimats –also intend to sign a project support agreement to facilitate the municipal company’s corporate reform plan, which is part of the EBRD-financed project. The company will aim to improve cost recovery for its services, promote water meters, improve internal audits and introduce an environmental and social action plan.

Janet Heckman, EBRD Director for Kazakhstan, said: “The EBRD and the government of Kazakhstan support a range of public utilities, from district heating to transport, in over 10 regions but we believe water and wastewater modernization, which directly benefit the lives of citizens, are of special importance.”

To date, the EBRD has invested over US$ 7 billion in Kazakhstan’s economy. In 2015 the EBRD is planning to invest close to US$ 1 billion in various sectors, with a focus on diversification.

Astana Times

The 42nd regular session of the working group on the Convention of the Legal Status of the Caspian Sea opened at the Kazakh Foreign Ministry in Astana Nov. 18.

Azerbaijan, Iran, Kazakhstan, Russia and Turkmenistan have been negotiating the legal status of the inland body of water since the early 1990s, when the issue arose following the collapse of the Soviet Union and the appearance of four new states on its shores. “During the negotiation process, Kazakhstan has since the beginning followed a compromise approach that takes into account the interests of all riparian countries. For this reason, Kazakhstan’s position on the main aspects of the legal status of the Caspian Sea was spread as an official document of the United Nations (UN) in 1997 and to date remains consistent and unchanged,” said Kazakh Foreign Minister Erlan Idrissov, explaining Astana’s position.

Kazakhstan’s approach is based on the need to establish the territorial waters, fishing zones and common water space in the Caspian Sea in accordance with the provisions of the 1982 United Nations Convention on the Law of the Sea to ensure the political and economic interests of the littoral countries.

“Concerning delimitation of the Caspian Sea bottom, Kazakhstan adheres to the position that it should be divided among the littoral states on the areas within which they have the sovereign right to conduct exploration and development of the natural resources of the Caspian shelf,” said Idrissov.

He suggested it would be advantageous to carry out delimitation of the Caspian Sea in accordance with existing international methods and practices based on the agreement of neighbouring states, taking into account generally-recognised norms of international law.

“Currently, Kazakhstan has concluded appropriate bilateral agreements with Russia, Azerbaijan and Turkmenistan which ensure the international legal framework for development of oil and gas reserves in the northeastern part of the Caspian Sea, thus creating an attractive and stable investment climate,” said the Kazakh minister.
The settlements indicate delimitation of the Kazakh sector of the sea bottom is almost complete, he said.

Regarding the order of navigation, Idrissov suggested the position which fully corresponds to the decisions of the fourth summit in Astrakhan. Thus, Kazakhstan recommended establishing a uniform regime in the national sovereignty area in accordance with the basic provisions of the law of the sea for all kinds of vessels, except warships. The authorisation procedure needs to be applied to warships to pass through the territorial waters.

In marine areas beyond the territorial waters, Kazakhstan proposed establishing freedom of navigation, based on the condition that vessels respect sovereign and exclusive rights of riparian states for the use of mineral resources and biological resources fishery.

The laying of pipelines and transit is extremely important to the interests of each state, said Idrissov, because it directly affects the degree of economic development, as well as international trade and economic relations in particular.